Aluminium Price Inches Up on LME; Global Supply Signals Tightening

Key Takeaways

• Prices Showing Strength: LME and MCX aluminium prices opened higher today, with renewed technical interest and key resistance near Rs 238.9/kg.
• China Nears Production Cap: China's Q1 output rose 3.2% YoY, approaching the national 45 MT cap set in 2017.
• Inventories Drop: Shanghai and Japanese port stocks declined 6.2% and 1.2% respectively, indicating tighter regional supply.
• Exports on the Rise: China’s exports of aluminium products surged 17% in the first ten months, totalling 5.5 million MT.
• RoDTEP Relief Sought: FIMI and AAI urged policy correction on RoDTEP withdrawal, calling it vital for export competitiveness.

Aluminium Price:

• As of last day, LME closed at $2439.9/MT. Today, LME opened at $2465.1/MT. 
• As of last day, MCX closed at Rs 236.45/Kg. Today, the market opened at Rs 235.65/Kg.

Aluminium Demand & Supply

• Global primary aluminium production rose by 2.3% in March compared to the same month last year, reaching 6.227 million mt, as reported by the International Aluminium Institute (IAI). In the first quarter of 2025, China— the leading aluminium producer worldwide—saw a 2.6% year-on-year increase in output, bringing it close to the government's annual production cap of 45 million tonnes established in 2017.
• In March alone, China's aluminium output increased by 4.4%, reaching 3.75 million mt. For the first quarter of the year (January to March), total production rose 3.2% year-on-year to 11.07 million mt. At the same time, aluminium inventories monitored by the Shanghai Futures Exchange fell by 6.2% over the week, while stockpiles at Japan's three main ports dropped 1.2% month-on-month to 309,700 mt—both signs of tightening regional supply. On the trade front, China’s exports of unwrought aluminium and related products grew by 17% in the first ten months of the year, totalling 5.5 million mt.

Aluminium News

• The Federation of Indian Mineral Industries (FIMI) has asked the government to restore RoDTEP benefits for aluminium exporters, citing financial pressure on domestic producers after the scheme's suspension for EOUs, SEZs, and AA units from February 2025.
• The Aluminium Association of India (AAI) backed the demand, highlighting that unrefunded taxes make up nearly 10% of production costs. Both bodies stressed that continued RoDTEP support is critical to maintain global competitiveness and sustain export growth, calling for urgent policy clarity.

Expert Opinion

From a technical standpoint, the market experienced renewed buying interest, with open interest rising by 0.46% to 5,036 contracts. Key support levels are identified at Rs 234.4 and Rs 232.3, while resistance is anticipated around Rs 237.7. A breakout above this level could lead to a test of Rs 238.9.