Indian aluminium industry wants quantitative curbs on imports

Aluminium-producing companies have moved the government to impose quantitative restrictions on imports as their demand to levy anti-dumping duty on cheap imports has not materialised for the last two years. Imports account for 54 per cent of total aluminium consumption in India, up from 52 per cent earlier.

Satish Pai, Managing Director, Hindalco Industries, said levy of anti-dumping duty seems to be a time consuming effort and would not have much impact as most of aluminium imports are from ASEAN countries with which India has signed a free trade agreement. The industry, he said, is now demanding that the Government impose quantitative restrictions so that the interest of domestic producers are protected, particularly when the demand is picking after a gap of several years. The government can restrict imports to the average of last five years and ensure that there is no dumping of cheap produce, he added. Overall, aluminium demand increased nine per cent to 3.5 million tonnes in the FY18 and interestingly nine per cent of the demand has come in the second half of the fiscal. Copper demand was down 2.5 per cent to 640,000 tonnes last fiscal, compared to a fall of 3 per cent in FY17.

Pai said if the current uptrend continues domestic aluminium demand should grow by 7-8 per cent while copper should register 3-4 per cent growth.

Globally, the electrical sector accounts for about 20 per cent of aluminium demand while housing and construction sector accounts for a major share. Domestic automobile companies will soon be a big source of consumption, he said.

“The biggest problem in the business is rising input cost. We have secured coke and pitch cost for six months through supply contracts to partially offset rising cost,” he said.

Aluminium prices on the London Metal Exchange increased by over 20 per cent over the last year, peaking at $2,600 per tonne in April and is expected to remain range bound at $2,200-2,300 per tonne this fiscal. Copper prices are expected to remain stable at the current $6,800 per tonne, he said.