Aluminium on MCX settled down -1.59% at 123.75 as supply concerns eased and demand remained weak in top metal consumers such as China. LME stocks are falling at a fast pace and physical premiums are rising, although as ever with aluminium appearances can be slightly deceptive. The deficit in the global aluminium market to widen further in CY2017 as a result of up to almost 3 million metric tonne (MMT) of production cutbacks in China, post the imposition of a new air pollution control regime in Beijing. China’s inventories of aluminum ingot registered the first decline after the 2017 Chinese New Year holiday.
Last week, total aluminum inventories in the five major trading markets fell 4,000 tonnes, according to data. The drop, despite a small one, was the first time since the end of the 2017 Chinese New Year holiday which fell in late January and early February. In other news, sources reported that some Japanese aluminum buyers have agreed to pay producers a premium of $128 per tonne for shipment during the three months to June, according to two sources directly involved in the quarterly pricing talks.
The agreed figure surged 35 percent from the premiums of $ 95 per tonne in the first quarter, the second quarterly increase in a row and the highest in two years. Technically market is under long liquidation as market has witnessed drop in open interest by -4.59% to settled at 2222 while prices down -2 rupees, now Aluminium is getting support at 123.1 and below same could see a test of 122.3 level, And resistance is now likely to be seen at 125.2, a move above could see prices testing 126.5.