Adv
LANGUAGES
English
Hindi
Spanish
French
German
Chinese_Simplified
Chinese_Traditional
Japanese
Russian
Arabic
Portuguese
Bengali
Italian
Dutch
Greek
Korean
Turkish
Vietnamese
Hebrew
Polish
Ukrainian
Indonesian
Thai
Swedish
Romanian
Hungarian
Czech
Finnish
Danish
Filipino
Malay
Swahili
Tamil
Telugu
Gujarati
Marathi
Kannada
Malayalam
Punjabi
Urdu
AL CIRCLE

Indian aluminium producers fear earnings drop due to falling aluminium prices

EDITED BY : 2MINS READ

With the international  aluminium price hovering at 20-month low, the earnings outlook for the domestic aluminium producers are at a risk and is banking heavily on import duty hike.

Currently the three months LME aluminium prices are at US$ 1846 per tonne, much lower than what analysts had estimated. Earnings estimates were largely made with US$1,940 a tonne as the price benchmark. The downturn in price will lower the earnings estimate significantly and the industry is banking on import duty hike. Indian primary aluminium industry has proposed an increase in import duty on scrap and primary aluminium from 2.5 per cent and 7.5 per cent, respectively, to 10 per cent. 

{alcircleadd}

Though an increase in import duties may offer some support, earnings outlook would remain weak due to the falling international prices. The trade war and tariffs have affected the automotive sales in 2018, causing a drop in automotive demand. We may expect the outlook to change once the trade war issues come to a solution.

Average aluminium production cost is estimated around $1,750 to $1,800 per tonne, given the rising alumina and coal costs. Indian players such as Hindalco and Nalco with their integrated alumina and bauxite and power facilities may not be affected much due to the falling prices, but aluminium producers who outsource their raw materials are more at risk. Vedanta fears a drop in earnings due to higher raw material price and falling aluminium prices.  Aluminium contributed 17 per cent to total earnings, and zinc 50 per cent, while oil largely contributed the rest. The decline in oil prices may also affect the total earnings. 

Despite the sharp correction in the commodity prices, Indian aluminium producers have managed to stay bullish so far. It is yet to be seen how the recent fall in price would affect the aluminium producers in the first quarter on CY 2019.

Adv
Adv
Adv
Adv
Adv
Adv
Adv
EDITED BY : 2MINS READ
Adv
Adv
Adv

Responses

Adv
Adv
Adv
Would you like to be
featured with us?
Business Cards
Featured
Want to get your company featured by us?
Business Cards
Featured
Adv
Adv
Business Leads VIEW ON AL BIZ

AL Circle News App
AL Biz App

A proud
ASI member
© 2025 AL Circle. All rights reserved.
AL Circle is not responsible for content from external sources.