Aluminium concluded the day with a decline of 0.21% at Rs 263.6, influenced by the resurgence of trade tensions between the U.S. and China, which raised concerns regarding global demand. Markets exhibited a degree of caution following the confirmation from U.S. Treasury Secretary Scott Bessent regarding President Trump’s forthcoming meeting with Chinese leader Xi Jinping in late October.

Concurrently, China adjusted its base metals output growth target to 1.5% annually for the years 2025–2026, a reduction from the previous 5%. This adjustment aligns with the country’s 45 million-ton aluminium production cap, which is intended to mitigate deflationary pressures. Meanwhile, Alcoa’s decision to close its Kwinana alumina refinery in Australia, due to declining ore grades, has heightened supply concerns. On the demand front, optimism remained evident, bolstered by increasing investments in data centers and a robust performance in Chinese manufacturing activity, as indicated by the expansion in the private PMI. Exports exhibited a decline — China dispatched 521,000 tonnes of unwrought aluminium and products in September, a decrease from August’s 534,000 tonnes.

Global aluminium fundamentals continue to exhibit a relatively constrained environment, as indicated by the World Bureau of Metal Statistics, which reported a supply deficit of 119,900 tons in July and a cumulative deficit of 985,300 tons from January to July 2025. Data from the International Aluminium Institute indicated a modest year-on-year increase in global primary output of 0.9%, reaching 6.277 million tonnes in August.

From a technical perspective, the market is experiencing long liquidation, evidenced by a 9.6% decline in open interest to 3,222 lots, alongside a price decrease of Rs 0.55. Aluminium currently has support at Rs 261.2, with a potential decline below this level likely to test Rs 258.9. Resistance is identified at Rs 265.8; a breakthrough above this point could lead to a rally towards Rs 268.1.