German aluminium producers face weak demand and rising costs in Q2 2026
Half of the German aluminium companies surveyed rated their second-quarter order books as poor or very poor. Production declined in the first half of 2026 as weak automotive, construction and machinery demand combined with higher input costs and tighter scrap supply.
Order books split along sector lines
Germany’s aluminium industry remained under pressure in the second quarter of 2026, with stronger demand from specialized sectors failing to offset weakness in its largest industrial markets. According to Recyclingportal, Aluminium Deutschland’s quarterly survey found that 50% of participating companies described their current order situation as poor or very poor. Another 30% reported a seasonally normal position, while 20% rated orders as good.
The divergence was pronounced across customer industries. About 70% of respondents serving aerospace assessed conditions as good, as did two-thirds of those exposed to defense and 63% of suppliers to the packaging industry. The picture was considerably weaker in volume markets: 63% rated the automotive situation as poor, while 60% gave the same assessment for both construction and mechanical engineering. Electrical engineering was described as seasonally normal or satisfactory.
Expectations for the rest of the year also remained subdued. Some 55% of companies expect weak capacity utilization through the end of 2026, compared with 20% anticipating a seasonally normal level and 25% forecasting good or very good utilization. Aerospace provided a limited positive signal, with more than 40% expecting conditions in that market to improve further.
Production and recycling volumes decline
The cautious outlook was reflected in production. German output of semi-finished aluminium products decreased by 2% in the first half of 2026 to just under 1.15 million tonnes. Second-quarter production totaled 580,266 tonnes, down 3%.
Total recycling volume also fell by 2% in the first half to about 1.36 million tonnes. The second-quarter figure was 671,236 tonnes, a decline of 2%, extending the gradual downward trend recorded in overall recycling during recent years. Refiners were the only modest exception, increasing first-half production by about 4% to 253,400 tonnes.
Scrap availability is adding to the pressure on recyclers. The survey found that 80% of companies were experiencing tighter conditions in the European aluminium scrap market. High scrap prices were identified as a major problem by 80%, while 50% cited limited availability of post-consumer scrap and 45% reported insufficient pre-consumer scrap.
Geopolitics and Chinese competition raise risks
Companies also linked new cost and supply pressures to tensions associated with the Iran conflict. Some 85% reported higher input costs for raw materials and intermediate products, 65% observed growing uncertainty among customers and 40% experienced supply-chain disruption. Looking ahead, 65% expect further cost increases and 60% anticipate additional supply shortages. In response, 70% have already adjusted prices and 55% have modified their supply chains.
International competition remains another concern. The survey showed that 85% see China at least partly as a risk to Germany as an industrial location, while 55% said the risks clearly outweigh the opportunities. Price competition and undercutting were cited by 90%, differences in environmental and social standards by 65%, and raw-material dependencies by 55%. Almost one-third also fear consequences for scrap supply.
The findings leave the industry dependent on aerospace, defense and packaging for stability while automotive, construction and mechanical engineering remain stagnant. Rob van Gils, president of Aluminium Deutschland, called for reliable energy and industrial-policy conditions and fair competition in international markets to protect the competitiveness of German industry.
