- Cautious buying keeps aluminium market sentiment subdued
- Stable premiums cushion domestic aluminium market weakness
Domestic aluminium prices in India declined w-o-w, despite a slight increase in LME 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 4,000/t (1.1%) w-o-w to INR 354,000/t.
How did Indian and global exchanges perform?
Domestic aluminium futures on the MCX declined by INR 4,750/t (1%) w-o-w to INR 343,900/t, exerting downward pressure on domestic aluminium prices.
Meanwhile, three-month aluminium prices on the LME increased by $37/t (1%) w-o-w to $3,220/t. LME aluminium inventories also edged down by 100 t (0.04%) w-o-w to 246,825 t, offering limited support to prices.
Market updates
The domestic aluminium market remained subdued during the week, tracking weaker MCX prices despite a slight increase in LME aluminium prices. A marginal drawdown in LME inventories provided some underlying support, while lower exchange stocks continued to indicate relatively tight metal availability.
Meanwhile, 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 remained stable at around $320-330/t, indicating steady physical market conditions.
Outlook
Domestic aluminium prices are expected to remain range-bound in the near term, with subdued demand and cautious buying likely to weigh on the physical market. However, relatively low LME inventories and stable domestic premiums could provide underlying support.
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