Maruti Suzuki India Limited, the largest automobile manufacturer in India and a major consumer of aluminium, has released its monthly settlement prices for aluminium ADC12 alloy ingots for July 2023 at INR INR 204,000 per tonne. This is a decrease of INR 2,900 per tonne compared to its settlement prices in June 2023 at INR INR 206,900 per tonne.

Market participants attribute the price decrease to lower demand and subdued exports, particularly to Japan. It's worth noting that Maruti Suzuki's ADC12 prices are considered the standard for determining domestic aluminium price trends. According to SteelMint's assessment, ADC12 prices decreased by INR 3,000 per tonne and stood at INR INR 187,000-189,000 per tonne ex-Faridabad (excluding GST).

In other news, Maruti Suzuki's total automobile production fell by 5.3 per cent Y-o-Y to 137,133 units, including passenger vehicles and light commercial vehicles, in June 2023 compared to 144,409 units produced in June 2022. However, automobile sales increased by 2.3 per cent Y-o-Y to 1,59,418 units in June 2023 compared to 1,55,857 units in June 2022.

Domestic passenger vehicle sales rose by 8 per cent to 1,33,027 units in the month under review against 1,22,687 units in June 2022. On the other hand, the company's exports fell by 17 per cent YoY to 19,770 units in June 2023 compared to 23,833 units in the corresponding month of the previous year. This is primarily attributed to the ongoing chip shortage, which has adversely affected the production capabilities of Maruti Suzuki's manufacturing plants.

In the automotive industry updates, India's automobile sales decreased by 7.4 per cent M-o-M to 1.78 million units in June 2023, according to SIAM data. On a YoY basis, sales rose by 5.8 per cent from 1.68 million units. Meanwhile, automobile production decreased by 4.7 per cent M-o-M to 2,024,703 units in June 2023. Similarly, on a Y-o-Y basis, the volumes fell by 2.7 per cent from 2,081,148 units in June 2022.

In contrast, China's automobile sales increased by 10.1 per cent M-o-M to 2.622 million units in June 2023, according to China Association of Automobile Manufacturers' data. On a Y-o-Y basis, sales rose by 4.8 per cent. In the January-June 2023 period, auto sales increased by 9.8 per cent Y-o-Y to 13.239 million units. Meanwhile, in June, automobile production increased by 2.5 per cent Y-o-Y to 2.561 million units.

The domestic aluminium alloy ingot market witnessed a price decline this week due to sluggish demand. Trade remained dull throughout the week. However, market participants noted a moderate supply of aluminium tense scrap alongside good demand. Tense prices were recorded at INR INR 152,000-154,000 per tonne, ex-Delhi, excluding GST. Imported tense scrap of US-origin prices were at US$1,630-1,650 per tonne, CFR Nhava Sheva.

In response to the ongoing market volatility, small-scale producers in the northern region maintained their production capacities at around 60-70 per cent. In contrast, western India's aluminium market dominated due to positive demand, better supply, and availability of imported raw materials. Notably, one of the established OEM associates or alloy exporters in the western region recently achieved record-breaking sales.

                       Received under the content exchange agreement with SteelMint