Aluminerie Alouette to Invest $1.1 Billion in Major Canadian Aluminum Revamp - Rio Tinto (NYSE:RIO)

Aluminerie Alouette, Canada's largest aluminum smelter and a key supplier to the U.S. market, announced a CA$1.5 billion ($1.1 billion) investment in its northern Québec facilities. The firm, owned by a Rio Tinto (NYSE:RIO)-led consortium, is making this commitment despite growing pressure from U.S. tariffs and global trade uncertainty.

"Today's announcement, which we have been working on for several months, paves the way for the coming decades for our current and future employees, our communities and our business partners," said Claude Gosselin, President and CEO of Aluminerie Alouette.

"We sincerely appreciate the collaboration of the Quebec government and Hydro-Québec for their unwavering confidence in the essential role that primary aluminum plays in the economic vitality of both our region and the province," he added.

The investment follows a newly signed long-term power agreement with Hydro-Québec that will guarantee electricity supply through 2045. With an annual capacity of 630,000 metric tons, the Sept-Îles facility is critical to North American aluminum supply chains.

Owned by a consortium that includes Rio Tinto (40%), Hydro Aluminium (20%), AMAG Austria Metall (20%), Marubeni (13.33%), and QUALIUM (6.67%), Aluminerie Alouette employs around 950 people and represents the largest private employer in the region.

Aluminum produced in Québec is particularly important to the United States, which has only four operating primary aluminum smelters, which are insufficient for domestic needs. Canada supplies approximately 2.7 million metric tons of aluminum to the U.S. annually, supporting sectors from automotive and aerospace to food packaging. The U.S., however, has threatened tariffs of up to 50% on Canadian aluminum, a move widely criticized as counterproductive.

"The United States needs Quebec to meet its demand, especially since we produce 70% of all aluminum in North America," Quebec's Economy Minister Christine Frechette said, according to Bloomberg. Still, with U.S. tariffs pushing Canadian aluminum out of the market, American manufacturers face rising costs for essential goods, while Canada’s producers look to Europe for alternative buyers.

The Canadian aluminum industry has taken steps to protect its market integrity, including supporting Finance Canada’s new import monitoring system and the "Country of Smelt and Cast" provisions designed to block unfair trade. Jean Simard, President of the Aluminium Association of Canada, noted that Canadian aluminum "is not—and will not be—a backdoor for unfair trade," pointing to Canada's leadership in traceability and sustainability.

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