Germany Aluminium Industry Decline Deepens as Energy Costs and CBAM Pressure Competitiveness

Germany Aluminium

Germany aluminium industry decline is becoming harder to reverse as production, recycling, and capacity utilization remain well below 2021 levels. Aluminium Deutschland said the sector showed no growth since 2021. Fourth-quarter output stayed only 76-88pc of 2021 levels. As a result, Germany aluminium industry decline now looks more structural than cyclical.

This matters because the sector is losing strength across several product categories at once. Rolled products rose slightly in 2025, but still remained 12pc below 2021 levels. Extruded products fell 1pc last year and stayed 24pc below 2021. Therefore, German aluminium competitiveness is weakening across both primary and semi-finished segments.

The association blames policy and cost pressure for the downturn. High energy prices, weak relief measures, and regulations such as CBAM are central concerns. The wider economy also remains soft. Consequently, Germany aluminium industry decline is being driven by both weak demand and a more difficult operating environment.

German Aluminium Competitiveness Is Under Pressure From Energy and Policy

German aluminium competitiveness is under direct pressure from high power costs and ineffective industrial support. Aluminium Deutschland said current policy frameworks no longer support recovery. It also warned that traditional policy thinking is failing domestic industry. As a result, the sector sees competitiveness risk as a core threat, not a temporary obstacle.

CBAM impact on aluminium is also becoming more controversial inside the industry. The association argues that CBAM may add burdens instead of meaningful protection. That concern is especially serious in a sector already facing cost disadvantages. Therefore, German aluminium competitiveness may weaken further if policy tools fail to deliver real relief.

This issue matters because aluminium is deeply tied to industrial employment and manufacturing resilience. If producers continue losing ground, Germany may become more dependent on imported metal and products. Meanwhile, the country could lose more industrial capacity in areas that support broader supply chains.

Aluminium Recycling in Germany Also Shows Industrial Weakness

Aluminium recycling in Germany is also moving in the wrong direction. German companies produced 2.7mn t of recycled aluminium in 2025. That was down 1pc on the year and 16pc below 2021 levels. As a result, the decline is not limited to primary production or semi-finished products.

Weak downstream demand is a major reason. Automotive, construction, and plant engineering all remained soft. Tight scrap availability and high scrap prices also hurt recycling economics. Therefore, aluminium recycling in Germany now reflects both industrial slowdown and raw material stress.

This matters because recycling should be one of Europe’s stronger advantages in aluminium. When recycling weakens alongside broader production, it signals a much deeper industrial problem. Consequently, Germany aluminium industry decline now extends across the full value chain rather than one isolated segment.

The Metalnomist Commentary

Germany’s aluminium sector is no longer describing a normal downturn. It is describing a competitiveness crisis. If energy costs, policy burdens, and weak demand continue together, Germany risks losing more than output. It risks losing strategic industrial capability.