Behind the LME aluminium shortfall is Russia-China story with no easy fix
There was a time when LME aluminium inventory (opening stock) was at 1.47 million tonnes. Only four years ago in July 2021, Live Warrants were at 8,97,275 tonnes and Cancelled Warrants at 5,68,500 tonnes. Fast-forward four years, LME aluminium opening stock came in at 340,975 tonnes, marking a sharp fall of more than half.
While stock loss is one concern, the other is the slim chance of stock build-up in the near future, due to which the LME aluminium benchmark price would remain on the upward trend. Already, by June 23, 2025, the LME aluminium 3-month official settlement price reached USD 2,584.50 per tonne, up by 6 per cent M-o-M from USD 2,448 per tonne, driven by decreased LME aluminium opening stock from 384,575 tonnes to 340,975 tonnes.
Of the total 340,975 tonnes of opening stocks, Live Warrants are standing at 321,800 tonnes and Cancelled Warrants at 19,175, indicating a higher rate of decline in Cancelled Warrants than in Live Warrants. While the former slumped by 97 per cent from July 2021, the latter stumbled by 64 per cent.
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