DBT Bureau
Pune, 10 Nov 2025
Aluminium settled higher by 0.28% at 272.5, supported by optimism over improving demand prospects and constrained output growth in China. Investor interest has surged in the LME aluminium contract as the market anticipates the end of chronic oversupply, with China’s production nearing its government-imposed 45 million tonne capacity cap. The European aluminium premium climbed to $328 per tonne from $183 in June, hitting its highest level since February, reflecting tightening physical supply. Meanwhile, inventories at the Shanghai Futures Exchange slipped 0.2% from last Friday, signaling steady demand in the domestic market. Supply disruptions further underpinned prices, as Iceland’s Grundartangi smelter suspended one potline following equipment failure, and Century Aluminium curtailed production by two-thirds at its Iceland plant for similar reasons. Additionally, Alcoa announced the permanent closure of its Kwinana alumina refinery in Australia due to deteriorating bauxite quality, tightening alumina supply globally. On the trade front, China’s unwrought aluminium and product imports jumped 35.4% year-on-year to 360,000 tonnes in September, while cumulative imports for the first three quarters of 2025 rose 5.7% to 3.01 million tonnes, signaling robust consumption trends. Technically, the market is under short covering as open interest fell by 2.31% to 3,085 while prices rose by 0.75 rupees. Aluminium finds support at 271.7, and a break below could test 270.7 levels, whereas resistance is seen at 273.3, with a move above likely to push prices towards 273.9.
Market Analysis:
- Aluminium trading range for the day is 270.7-273.9.
- Aluminium gains helped by prospects of improved demand and limited output growth in China.
- China reiterated its priority of preventing overcapacity in metal production to curb deflationary pressures.
- Aluminium inventories in warehouses monitored by the Shanghai Futures Exchange fell 0.20% from last Friday.
