Alcoa Warns of Heavy Financial Toll from New U.S. Tariffs on Canadian Aluminum

Alcoa has reported $20 million in added costs for the first quarter of 2025, directly tied to new U.S. tariffs on aluminum imported from Canada. The 25% tariff, enacted on March 12, is projected to push the company’s second-quarter costs to $90 million, according to CFO Molly Bierman.

The impact could worsen over the course of the year. Alcoa CEO William Oplinger stated that up to 70% of the company’s Canadian aluminum is sold to U.S. customers, and the tariff could cost the company as much as $425 million annually.

Oplinger also flagged rising costs for raw materials sourced from China, which are now subject to higher tariffs. Those expenses are expected to add $10 million to $15 million annually due to limited alternative suppliers.

Alcoa expects to partially offset some of the increased costs through higher Midwest Premiums—extra charges that buyers pay on top of the base aluminum price. Even with that adjustment, the company anticipates a net annual loss of roughly $100 million due to the tariffs.

Alcoa has publicly criticized the tariff measures, warning in earlier statements that they could lead to major job losses across the U.S. aluminum industry.

Following these developments, Bank of America downgraded Alcoa’s stock from “Buy” to “Underperform,” cutting its price target by more than half, from $58 to $26, citing both weaker aluminum prices and escalating trade-related expenses.