Aluminium prices experienced an upward movement, increasing by 1.44% to close at Rs 355.65, driven by heightened supply concerns in the wake of Iranian strikes on significant producers in the Middle East. Damage to facilities operated by Emirates Global Aluminium and Aluminium Bahrain has led to disruptions in output, while partial shutdowns have exacerbated supply constraints. The persistent conflict and the closure of the Strait of Hormuz have further constrained shipments to significant markets such as the U.S. and Europe, thereby contributing to market uncertainty.

The supply side continues to experience significant pressure at its core. LME warehouse stocks have experienced a significant decline over the past year, while physical premiums have escalated to multi-year highs, indicating a constrained supply situation. Emerging risks are being observed from Guinea, a significant supplier of bauxite, as it contemplates implementing export restrictions.

Nonetheless, certain supply concerns are being mitigated by increasing global inventories and consistent production growth, which includes elevated output from China. On the demand side, prudent purchasing behavior and apprehensions regarding global economic growth are constraining more robust upward momentum. China’s imports have experienced a decline, while domestic production remains on an upward trajectory, resulting in a mixed overall balance.

From a technical perspective, the market is exhibiting renewed buying interest, as evidenced by a 1.74% increase in open interest, reaching 3,156 lots. Immediate support is identified at Rs 338.1, with potential further decline toward Rs 320.6. On the upside, resistance is positioned at Rs 364.6, and a breakout beyond this threshold may propel prices toward Rs 373.6.