Alcoa Corp Declines Amid Tariff Policy Reversal
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Apr 14 2025
0mins
Should l Buy AA?
Source: WSJ
Alcoa Corp's stock fell by 5.49% as it hit a 5-day low, reflecting investor concerns over potential tariff rollbacks affecting aluminum prices.
The decline follows reports of President Trump's plans to reverse aluminum tariffs, which has led to a drop in aluminum futures and heightened market uncertainty. This policy change could significantly impact profit margins for U.S. aluminum producers, including Alcoa, as it may increase foreign competition and reduce domestic pricing power.
The implications of this tariff reversal could reshape the aluminum market, leading to increased volatility and affecting the overall profitability of companies like Alcoa. Investors are closely monitoring these developments as they could have lasting effects on the sector.
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Analyst Views on AA
Wall Street analysts forecast AA stock price to fall
8 Analyst Rating
2 Buy
4 Hold
2 Sell
Hold
Current: 59.690
Low
38.00
Averages
57.63
High
78.00
Current: 59.690
Low
38.00
Averages
57.63
High
78.00
About AA
Alcoa Corporation is a vertically integrated aluminum company comprised of bauxite mining, alumina refining, aluminum production (smelting and casting), and energy generation. The Company’s operations are comprised of two business segments: Alumina and Aluminum. The Alumina segment primarily consists of its bauxite mines and alumina refineries, which generally include the mining of bauxite and other aluminous ores, as well as the refining, production, and sale of smelter grade and non-metallurgical alumina. The alumina produced by this segment is sold to internal and external aluminum smelter customers; a portion of the alumina is sold to external customers who process it into industrial chemical products. The Aluminum segment consists of the Company’s aluminum smelting and casting operations along with the Company’s energy production assets in Brazil, Canada, and the United States. It has direct and indirect ownership of 26 operating locations across nine countries on six continents.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Alcoa Partners with Australian Government to Modernize Mining Approvals Framework
- Strategic Assessment Initiative: Alcoa has partnered with the Australian Federal Government to conduct a strategic assessment of its mining activities in Western Australia, expected to extend to 2045, aiming to provide a comprehensive view of potential impacts on significant flora and fauna, thereby enhancing stakeholder confidence in the future of mining operations.
- Strengthened Environmental Commitments: Alcoa commits to limiting clearing to 800 hectares annually and plans to increase annual rehabilitation rates to 1,000 hectares by 2027, demonstrating the company's ongoing efforts in environmental protection and aiming to enhance its sustainability image within the industry.
- Significant Economic Contribution: In 2024, Alcoa's investments in Australia reached A$2.7 billion, supporting approximately 5,500 direct and indirect jobs, with over 70% of revenue generated remaining in Australia, indicating the company's positive impact on the local economy.
- Future Development Outlook: Despite the strategic assessment, Alcoa plans to commence mining activities in the new Myara North and Holyoake regions by 2029, which is expected to further bolster the company's role in critical minerals production and enhance its competitive position in the market.
See More
Supreme Court Strikes Down Trump's Tariff Policy
- Tariff Policy Impact: The Supreme Court's ruling against Trump's tariff agenda is expected to reduce the average household cost burden to between $600 and $800 in 2026, down from $1,000 in 2025, alleviating economic pressure on consumers, particularly low-income households.
- Legal Authority Challenge: In a 6-3 decision, the Supreme Court ruled that the International Emergency Economic Powers Act (IEEPA) does not authorize the president to unilaterally impose tariffs, which limits presidential power over tariff policy and could lead to significant changes in future tariff regulations.
- Alternative Pathways Explored: The Trump administration may seek to impose tariffs through other legal avenues such as Section 122 of the 1974 Trade Act and Section 338 of the 1930 Smoot-Hawley Tariff Act, although these measures may face legal challenges and have lower tariff caps.
- Ongoing Consumer Impact: Despite the overturning of IEEPA tariffs, the average effective tariff rate in the U.S. remains at 9.1%, meaning consumers will still experience price increases when purchasing metal products, electronics, and vehicles, with low-income households bearing a heavier burden.
See More
G7 Summit Highlights Growing Uncertainty in Global Trade Policies
- Supreme Court Ruling: The U.S. Supreme Court's 6-3 decision ruled that Trump's tariff policies lack legal authorization, prompting cautious reactions from global trading partners and increasing uncertainty in international trade.
- UK Trade Relations: A UK government spokesperson stated they will continue to work with the White House to understand the ruling's impact on tariffs, while the existing trade deal with the U.S. is expected to remain unaffected, preserving the UK's preferential trading position.
- Business Reactions: The British Chambers of Commerce noted that the Supreme Court decision does little to clarify the situation for UK businesses, warning that Trump still has options to maintain current steel and aluminum tariffs, which could complicate rebate claims for U.S. importers.
- International Trade Concerns: Swissmem, Switzerland's technology industry association, welcomed the ruling but cautioned that the Trump administration might invoke other laws to legitimize tariffs, urging Swiss policymakers to enhance competitiveness through new free trade agreements.
See More
Supreme Court May Rule on Trump's Tariff Legality
- Consumer Impact of Tariffs: The current average effective tariff rate in the U.S. stands at 16.9%, the highest since 1932, with projections indicating that consumers will pay an additional $1,300 to $1,700 in 2026, significantly increasing household economic burdens.
- Potential Legal Changes: Should the Supreme Court rule IEEPA tariffs unconstitutional, the consumer burden could be halved to between $600 and $800, providing some economic relief for families and influencing future spending patterns.
- Tariff Revenue Analysis: U.S. Customs and Border Protection collected approximately $133.5 billion in tariff revenue in fiscal year 2025, accounting for 60% of total tariff revenue during that period, highlighting the significant impact of tariff policies on government finances.
- Alternative Tariff Pathways: The Trump administration may resort to other legal frameworks to continue imposing tariffs, and economists note that even if IEEPA is overturned, this will limit potential consumer relief while maintaining high tariff burdens.
See More
Alcoa Partners with Australian Government to Modernize Mining Approvals
- Environmental Agreement: Alcoa has reached an agreement with the Australian Federal Government to modernize its mining approvals under the Environment Protection and Biodiversity Conservation Act, aiming for a comprehensive assessment of environmental impacts in current and potential mining areas through 2045, thereby enhancing operational transparency and sustainability.
- Annual Clearing Limits: The company commits to limiting clearing to 800 hectares per year while planning to increase rehabilitation efforts to 1,000 hectares annually by 2027, reflecting its strong commitment to environmental sustainability, and will continue operations at the Huntly and Willowdale mines during the assessment period.
- Financial Implications: Alcoa has agreed to pay $36 million AUD (approximately $55 million AUD) under enforceable undertakings, despite asserting compliance with the EPBC Act, with the full cash payment expected in 2026, and an additional $19 million charge to adjust environmental reserves tied to these undertakings will impact the previously reported fourth-quarter 2025 cost of goods sold.
- Stock Performance: Alcoa shares rose 5.18% to $60.44 on Wednesday, indicating strong market performance with a 55.28% increase over the past 12 months, despite mixed short-term trends, reflecting investor confidence and potential growth opportunities.
See More
Alcoa to Pay A$55M for Unauthorized Forest Clearing in Australia
- Environmental Compensation Agreement: Alcoa has agreed to pay A$55 million (approximately $38.9 million) to restore native forests cleared without approval in Western Australia, covering nearly 2,100 hectares, highlighting the company's pressure regarding environmental compliance.
- Acknowledgment of Historical Clearing: Although Alcoa claims its operations comply with the Environment Protection and Biodiversity Conservation Act, it has agreed to pay A$36 million through enforceable undertakings, indicating recognition of past clearing actions and their ecological impacts.
- Financial Impact: The company will record an incremental charge of $19 million ($13 million after-tax, or $0.05 per share) in Q4 2025, affecting its cost structure and potentially having a negative impact on shareholder returns.
- Future Strategic Assessment: Alcoa plans to conduct a strategic assessment of current and potential future mining areas through to 2045, demonstrating the company's adaptability to changes in environmental regulations and commitment to sustainability.
See More
Alcoa Partners with Australian Government to Modernize Mining Approvals Framework
- Strategic Assessment Initiative: Alcoa has partnered with the Australian Federal Government to conduct a strategic assessment of its mining activities in Western Australia, expected to extend to 2045, aiming to provide a comprehensive view of potential impacts on significant flora and fauna, thereby enhancing stakeholder confidence in the future of mining operations.
- Strengthened Environmental Commitments: Alcoa commits to limiting clearing to 800 hectares annually and plans to increase annual rehabilitation rates to 1,000 hectares by 2027, demonstrating the company's ongoing efforts in environmental protection and aiming to enhance its sustainability image within the industry.
- Significant Economic Contribution: In 2024, Alcoa's investments in Australia reached A$2.7 billion, supporting approximately 5,500 direct and indirect jobs, with over 70% of revenue generated remaining in Australia, indicating the company's positive impact on the local economy.
- Future Development Outlook: Despite the strategic assessment, Alcoa plans to commence mining activities in the new Myara North and Holyoake regions by 2029, which is expected to further bolster the company's role in critical minerals production and enhance its competitive position in the market.
See More
Supreme Court Strikes Down Trump's Tariff Policy
- Tariff Policy Impact: The Supreme Court's ruling against Trump's tariff agenda is expected to reduce the average household cost burden to between $600 and $800 in 2026, down from $1,000 in 2025, alleviating economic pressure on consumers, particularly low-income households.
- Legal Authority Challenge: In a 6-3 decision, the Supreme Court ruled that the International Emergency Economic Powers Act (IEEPA) does not authorize the president to unilaterally impose tariffs, which limits presidential power over tariff policy and could lead to significant changes in future tariff regulations.
- Alternative Pathways Explored: The Trump administration may seek to impose tariffs through other legal avenues such as Section 122 of the 1974 Trade Act and Section 338 of the 1930 Smoot-Hawley Tariff Act, although these measures may face legal challenges and have lower tariff caps.
- Ongoing Consumer Impact: Despite the overturning of IEEPA tariffs, the average effective tariff rate in the U.S. remains at 9.1%, meaning consumers will still experience price increases when purchasing metal products, electronics, and vehicles, with low-income households bearing a heavier burden.
See More
G7 Summit Highlights Growing Uncertainty in Global Trade Policies
- Supreme Court Ruling: The U.S. Supreme Court's 6-3 decision ruled that Trump's tariff policies lack legal authorization, prompting cautious reactions from global trading partners and increasing uncertainty in international trade.
- UK Trade Relations: A UK government spokesperson stated they will continue to work with the White House to understand the ruling's impact on tariffs, while the existing trade deal with the U.S. is expected to remain unaffected, preserving the UK's preferential trading position.
- Business Reactions: The British Chambers of Commerce noted that the Supreme Court decision does little to clarify the situation for UK businesses, warning that Trump still has options to maintain current steel and aluminum tariffs, which could complicate rebate claims for U.S. importers.
- International Trade Concerns: Swissmem, Switzerland's technology industry association, welcomed the ruling but cautioned that the Trump administration might invoke other laws to legitimize tariffs, urging Swiss policymakers to enhance competitiveness through new free trade agreements.
See More
Supreme Court May Rule on Trump's Tariff Legality
- Consumer Impact of Tariffs: The current average effective tariff rate in the U.S. stands at 16.9%, the highest since 1932, with projections indicating that consumers will pay an additional $1,300 to $1,700 in 2026, significantly increasing household economic burdens.
- Potential Legal Changes: Should the Supreme Court rule IEEPA tariffs unconstitutional, the consumer burden could be halved to between $600 and $800, providing some economic relief for families and influencing future spending patterns.
- Tariff Revenue Analysis: U.S. Customs and Border Protection collected approximately $133.5 billion in tariff revenue in fiscal year 2025, accounting for 60% of total tariff revenue during that period, highlighting the significant impact of tariff policies on government finances.
- Alternative Tariff Pathways: The Trump administration may resort to other legal frameworks to continue imposing tariffs, and economists note that even if IEEPA is overturned, this will limit potential consumer relief while maintaining high tariff burdens.
See More
Alcoa Partners with Australian Government to Modernize Mining Approvals
- Environmental Agreement: Alcoa has reached an agreement with the Australian Federal Government to modernize its mining approvals under the Environment Protection and Biodiversity Conservation Act, aiming for a comprehensive assessment of environmental impacts in current and potential mining areas through 2045, thereby enhancing operational transparency and sustainability.
- Annual Clearing Limits: The company commits to limiting clearing to 800 hectares per year while planning to increase rehabilitation efforts to 1,000 hectares annually by 2027, reflecting its strong commitment to environmental sustainability, and will continue operations at the Huntly and Willowdale mines during the assessment period.
- Financial Implications: Alcoa has agreed to pay $36 million AUD (approximately $55 million AUD) under enforceable undertakings, despite asserting compliance with the EPBC Act, with the full cash payment expected in 2026, and an additional $19 million charge to adjust environmental reserves tied to these undertakings will impact the previously reported fourth-quarter 2025 cost of goods sold.
- Stock Performance: Alcoa shares rose 5.18% to $60.44 on Wednesday, indicating strong market performance with a 55.28% increase over the past 12 months, despite mixed short-term trends, reflecting investor confidence and potential growth opportunities.
See More
Alcoa to Pay A$55M for Unauthorized Forest Clearing in Australia
- Environmental Compensation Agreement: Alcoa has agreed to pay A$55 million (approximately $38.9 million) to restore native forests cleared without approval in Western Australia, covering nearly 2,100 hectares, highlighting the company's pressure regarding environmental compliance.
- Acknowledgment of Historical Clearing: Although Alcoa claims its operations comply with the Environment Protection and Biodiversity Conservation Act, it has agreed to pay A$36 million through enforceable undertakings, indicating recognition of past clearing actions and their ecological impacts.
- Financial Impact: The company will record an incremental charge of $19 million ($13 million after-tax, or $0.05 per share) in Q4 2025, affecting its cost structure and potentially having a negative impact on shareholder returns.
- Future Strategic Assessment: Alcoa plans to conduct a strategic assessment of current and potential future mining areas through to 2045, demonstrating the company's adaptability to changes in environmental regulations and commitment to sustainability.
See More
