Higher alumina output may not translate into revenue gains for NALCO in FY27 due to soft prices, says Brijendra Pratap Singh

Throughout FY26-27,  alumina is going to be the key topic of NALCO’s growth story, but pricing trends could somewhat affect the benefits of higher production. The National Aluminium Company Limited is preparing for yet another year of strong operational performance across both its metals and chemicals businesses. But this growth momentum comes in the background of a global market shift against alumina, as pointed out by NALCO CMD Brijendra Pratap Singh.

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Speaking to Business Today, Mr Singh said the company is on track to exceed its internal production plans in the coming fiscal. Alumina output is currently running about 90,000 tonnes ahead of schedule, putting total production on course to reach nearly 2.3 million tonnes by year-end. In the metals business, aluminium production is projected at around 470,000 lakh tonnes, provided the current operating momentum continues.

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While volumes are expected to remain robust, the external pricing environment is becoming less supportive. Singh indicated that alumina prices are likely to decline sequentially through 2026, with prices expected to move around USD 320-340 per tonne. The weakness is driven by an emerging global alumina surplus, coupled with reduced demand following cutbacks in smelting capacity worldwide.

According to Singh, structural changes in the global aluminium industry are reshaping demand patterns. Particularly, with China’s 45 million tonnes cap and South32’s Mozal smelter shutdown as anticipated, global alumina prices are under pressure. Due to this,  NALCO expects its chemicals business to remain under pressure through much of 2026, with limited relief from pricing in the near term.

The subdued price environment brings back a long-standing reality for the public-sector aluminium major, which has historically leaned on its integrated business model to absorb swings in commodity markets. During the tenure of former chairman and managing director Sridhar Patra, the company prioritised long-term security of critical inputs, notably bauxite and coal, to sustain its position on the lower end of the global cost curve. According to Singh, that approach remains firmly in place today, complemented by a sharper focus on operational efficiency, including reductions in caustic soda and coal tar pitch usage. By driving volumes and tightening costs, management aims to protect overall performance as the international market works through the current pricing reset.

Beyond its core alumina operations, NALCO is also advancing its diversification plans in critical minerals through KABIL. Singh said invasive exploration activities in Argentina are expected to begin around January, and the company remains optimistic about the prospects of commercial mining by next year. Discussions are also underway that could see other Indian public-sector players, such as ONGC Videsh and Coal India, joining NALCO in acquiring additional Argentinian blocks.

Although these overseas ventures are still at the exploration and due diligence stage, they signal NALCO’s intent to build exposure to lithium and cobalt supply chains. Over the longer term, management sees this diversification as a potential hedge against the cyclical volatility that characterises the aluminium and alumina markets.

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