Question 1

Why is MCX aluminium price up or down today?

Accepted Answer

MCX aluminium tracks LME aluminium (London Metal Exchange) via import parity. It rises when Chinese aluminium smelters curtail output (power rationing, environmental inspections), LME warehouse stocks fall, or the rupee weakens. It falls when China pumps more aluminium into the market, energy costs ease (lowering smelting costs), or the US imposes safeguard measures that redirect Chinese exports. Aluminium is the most "state-influenced" base metal — Chinese government power subsidies are the single biggest price suppressant.

Question 2

How does Chinese aluminium production affect MCX prices in India?

Accepted Answer

China produces 58% of global primary aluminium. Monthly output data from China's National Bureau of Statistics (NBS), released around the 16th of each month, is the most closely watched supply signal. A surprise drop in Chinese output typically lifts LME prices 1–3% within a session. Indian producers (Hindalco, BALCO/Vedanta) also respond — they benefit from higher LME prices but face competition from cheaper Chinese imports. Watch for Chinese power availability in Yunnan and Inner Mongolia where most smelters operate.

Question 3

What is MCX aluminium lot size and margin?

Accepted Answer

MCX Aluminium standard contract has a lot size of 1,000 kg, quoted in ₹ per kg. At mid-2026 aluminium prices (~₹265/kg), one lot is worth approximately ₹2.65 lakh. SPAN margin is approximately ₹5,000–9,000 per lot. The Aluminium Mini (500 kg) is available for smaller capital. Tick size is ₹0.05/kg.

Question 4

What moves MCX Aluminium price?

Accepted Answer

China smelter output — Chinese aluminium production data (monthly) is the single most important supply signal Energy prices — European gas/electricity costs determine European smelter viability LME aluminium warehouse stocks — low inventory = tight physical market China stimulus — infrastructure and EV policy announcements directly lift aluminium US tariffs on aluminium imports — Section 232 tariffs distort global trade flows USD/INR — import parity transmission to MCX

Question 5

Who are the main buyers of Aluminium in India?

Accepted Answer

Transportation (30% of demand) — aviation, auto (lightweighting for EVs), rail Construction — windows, facades, roofing, power transmission cables Packaging — aluminium cans, foil, food-grade containers Electrical — power cables (aluminium is the main conductor for high-voltage lines) Green energy transition — EV battery casings, solar panel frames, wind turbine parts

Question 6

Who controls Aluminium supply globally?

Accepted Answer

China produces 58% of global primary aluminium — the highest concentration of any major metal. Russia (Rusal, 6%) and Canada (5%) are the next largest. Aluminium smelting is extremely electricity-intensive (15,000 kWh per tonne), so cheap hydropower nations (China, Russia, Iceland, Norway) dominate. Power costs determine who runs and who shuts.

Question 7

What are the key risks in MCX Aluminium trading?

Accepted Answer

Aluminium's price is heavily state-influenced — Chinese government subsidies to aluminium smelters (cheap power, cheap alumina) suppress the global price floor. Sudden US or EU import tariff changes cause sharp basis dislocations. Indian producers (Hindalco, Vedanta's BALCO) are large enough to influence MCX premiums.

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