Aluminium prices increased by 1.02%, closing at Rs 257.8, bolstered by ongoing supply-side uncertainties, even as demand trends remain inconsistent. In North America, consumption declined by 4.4% year-on-year in the first half of 2025, attributed to diminished exports and the impact of tariff pressures. Meanwhile, China’s production growth is constrained by its annual limit of 45 million tons. Output reached 44 million tons in April, with capacity estimated at 45.69 million tons in June, indicating constrained potential for additional growth.

Concerns regarding supply intensified following the revocation of all mining licenses held by Guinea Alumina, raising ore supply risks for the significant producer Emirates Global Aluminium. In the realm of equities, primary aluminium inventories within the LME experienced a significant decline of nearly 100,000 tonnes, reaching 375,000 in early September, indicative of robust speculative and physical demand.

Data indicates that global primary aluminium production in August increased by 0.9% year-on-year, reaching 6.277 million tonnes. Meanwhile, WBMS figures revealed a global deficit of 119,900 tonnes in July. From January to July 2025, the cumulative deficit expanded to 985,300 tonnes, driven by consumption exceeding production. China’s aluminium trade flows exhibited resilience, with exports of unwrought aluminium and products increasing to 542,000 tonnes in July, while imports in August saw a year-on-year rise of 12.9% to 320,000 tonnes. From January to August, total imports increased by 2.7% compared to the previous year, reaching 2.65 million tonnes, highlighting persistent demand.

Aluminium is experiencing new buying activity, as evidenced by a 3.82% increase in open interest to 4,186, coinciding with a price rise of Rs 2.6. Support stands at Rs 256.1, with additional downside potential at Rs 254.2, whereas resistance is identified at Rs 259.3, beyond which Rs 260.6 may be approached. Aluminium experienced an uptick as ongoing supply threats continued to loom.