- MCX and LME futures surged sharply
- Primary producers raised domestic prices
Domestic aluminium prices in India edged higher w-o-w, driven by a rise in LME and MCX aluminium futures, as global supply concerns persisted.
As per BigMint’s assessment, domestic aluminium ingot prices in Delhi increased by INR 8,000/t, or 3%, w-o-w to INR 326,000/t, while Mumbai prices jumped by INR 32,000/t, or 10%, w-o-w to INR 351,000/t as of 29 January.
How did Indian and global exchanges perform?
Domestic aluminium futures on the MCX strengthened w-o-w by INR 35,750/t, or 11%, to INR 349,750/t as of 29 January, reflecting a notable jump in prices.
In the global market, LME aluminium prices also moved higher, by $205/t, or 6.6%, w-o-w to $3,320/t. Global aluminium prices surged reaching near four-year highs as a sharp fall in the US dollar boosted risk appetite across base metals. The rally intensified after President Trump downplayed concerns over dollar weakness, pushing investors toward commodities. Tight global inventories, power uncertainties at new Indonesian smelters, and steady EV and grid-related demand supported prices, though longer-term supply growth is expected to outpace demand.
Meanwhile, LME warehouse stocks decreased by 7,200 t, or 3.1%, w-o-w to 499,975 t, indicating inventory withdrawals. Tight global supply conditions remained evident in physical markets. Reflecting this, the premium for aluminium shipments to Japan for January-March 2026 was set at $195/t, up 127% q-o-q and marking the first quarterly increase in a year. Elevated premiums are expected to persist into Q2CY’26, supported by ongoing smelter disruptions, tight global inventories, and firm underlying supply fundamentals, even as domestic demand remains moderate.
Market insights
Domestic aluminium ingot prices showed uptrend for the week also reflecting the revisions by primary producers.
NALCO increased its P1020 prices w-o-w by INR 8,000/t reaching INR 333,400/t, as revised on 28 January, reflecting the strong market cues.
BALCO lifted its prices for P1020 by INR 12,700/t to INR 353,500/t on 29 January. Similarly, Hindalco’s prices also saw an increase of INR 13,085/t reaching INR 352,250/t.
Market participants indicated that demand in the domestic aluminium market has improved, while inventory levels with major primary producers are reported to be at moderate levels. Meanwhile, domestic premiums edged slightly lower w-o-w to around $250-260/t above LME cash, as elevated LME prices weighed on premium levels.
Major updates
Hindalco Industries has committed INR 21,000 crore to expand its aluminium operations in Odisha, covering both upstream and downstream capacities. The investment includes a smelter expansion at the Aditya Aluminium site and a INR 4,500 crore flat rolled products and battery grade foil facility. The new foil plant will support 100 GWh of lithium ion cell manufacturing, reduce India’s import dependence, incorporate renewable energy, and form part of Hindalco’s INR 55,000 crore national expansion plan.
Outlook
Domestic aluminium prices in India are expected to remain firm in the near term, supported by elevated LME prices, tight global inventories, and strong futures momentum. Continued revisions by primary producers, steady demand improvement, and supply-side constraints are likely to underpin prices, although high LME levels may cap domestic premiums and limit upside in physical markets.
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