India’s aluminium wire rod import on the rise, Indian producers boost production to cater to the growing demand

As shown by AlCircle’s report on “A Worldwide Market Analysis of Aluminium Wire rod, Cables & Conductors - Industry forecasts to 2025”, China is the world’s major producer of aluminium wire rod followed by India supplying together about 67% of the global aluminium wire rod usage. India’s share of the global wire rod market is expected to increase from 18% in 2017 to about 23% in 2025, while China’s usage is expected to see a flat growth. The booming market calls for extra focus on the expansion of wire rod  capacities by Indian aluminium producers.

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However, as a result of the simmering US-China trade conflict, India has faced a flood of imports of an array of aluminium products including aluminium wire rods. Overall imports have risen 32 per cent in July-September period. In addition to scrap, imports of fake semis from China and wire rods from South East Asia region have increased creating a concern among domestic makers.

According to Hindalco managing director Satish Pai, higher import of value-added products from ASEAN region and China is hurting the aluminium maker, resulting in subdued sales despite a healthy domestic demand.

"This is a big concern as imports are eating away domestic demands. While industry aluminium demand grew by 12% during the quarter, sales grew by just about 2%. We would like the government to provide some relief to the industry by raising the duties," Pai said.

Currently, import duties on secondary value-added aluminium products stand at 7.5%.

Hindalco’s production of aluminium value-added products including wire rod was higher at 123 kt in Q2 2018 against 119 kt in the previous year regardless of the continuous surge in imports.

Hindalco considers it to be a major challenge where its products are getting un-competitive in comparison to Chinese or South Asian imports. The firm is also seeking some government support for the domestic industry as a continued surge of value-added aluminium products are hurting domestic aluminium companies.

To get more information on the world aluminium wire rod market, check the detailed Table of Contents of AlCircle's latest sector focus report here. You can also book your copy of AlCircle's Wire rod market report here.