India: Aluminium prices weaken w-o-w on lower MCX, LME trends

• Monsoon limits aluminium demand and inventory building
• Buyers focus on immediate requirements amid subdued demand

Domestic aluminium prices in India declined w-o-w, tracking weaker trends in LME and MCX aluminium prices. The domestic physical market softened amid subdued market sentiment.

According to BigMint’s assessment, P1020 aluminium ingot prices in Delhi NCR decreased by INR 7,000/t (1.9%) w-o-w to INR 355,000/t, from INR 362,000/t a week earlier.

How did Indian and global exchanges perform?

Domestic aluminium futures on the MCX declined by INR 3,710/t (1%) w-o-w to INR 348,190/t, from INR 351,900/t in the previous week.

Meanwhile, three-month aluminium prices on the LME fell by $54/t (2%) w-o-w to $3,205/t, from $3,259/t. The decline in both MCX and LME prices exerted downward pressure on domestic aluminium prices.

Market updates

The domestic aluminium market remained firm during the week despite slight declines in MCX and LME prices, while a further drawdown in LME inventories provided underlying support. Lower exchange stocks continued to indicate relatively tight metal availability, although benchmark price movements remained subdued.

However, demand remained subdued amid the ongoing monsoon season, with buyers largely restricting purchases to immediate requirements and showing limited interest in inventory building. Domestic aluminium premiums increased slightly to around $320-330/t, indicating relatively stable physical market conditions.

Outlook