Jerome Pecresse, the chief executive of Rio Tinto’s aluminum business, recently expressed skepticism regarding the United States’ ability to revitalize its aluminum production through tariffs. As Pecresse said, the market conditions for smelting aluminum in U.S. right now are “not favorable.” He cautioned that attempts to reshore more manufacturing back to American soil might face notable headwinds.
Pecresse, formerly one of the most powerful executives at the global mining giant Rio Tinto, noted the elephant in the room. She pointed out that despite the 25% tariff former President Donald Trump put on all aluminum imports, building up significant production capabilities in the United States would take “many, many years. Scaling up domestic manufacturing was never going to be simple. This is particularly true for an industry that has been highly dependent on international suppliers.
The backdrop of Pecresse’s statements go deeper, stemming from this larger strategic mindset. Washington has already declared aluminum a strategically critical material, adding momentum to arguments based on national security and economic independence. Former President Trump’s administration sought to drive greater U.S. manufacturing by using tariff policies as a coherent strategy to drive production home. Pecresse’s remarks highlight the real question of the feasibility of these types of measures in the aluminum sector.
Today, Rio Tinto owns and operates a major aluminum smelter in Bell Bay, Australia, which plays a major role in the company’s worldwide production. The company remains focused on its established facilities and production capabilities abroad, rather than rushing into a potentially uncertain U.S. market.
Pecresse’s comments underscore a growing concern in the business. In light of the long-term challenges presented by trade, many are asking if we can sustainably grow more domestic production by relying solely on tariffs. He added that the current U.S. infrastructure is not conducive to a successful aluminum smelting operation. On top of that, the overall market conditions aren’t making this process any easier.