- 13 Dec 2024
- ICICI Securities
ALUMINA PRICES WITNESSED A SHARP DECLINE BY 15% FROM ALL-TIME HIGH LEVEL
News: As per media sources, Alumina price has declined to $700/ton from all time high of $820/ton. This declined can be largely attributed to Chinese aluminium smelters are shutting down their operations owing to higher alumina prices and tepid demand for aluminium. Moreover, Australian miner South32 has also withdrawn its production guidance for 3.5 lakh tons of aluminium, which leads to lower demand for alumina.
Views: This development is negative, particularly for NALCO as it is a major player selling alumina in the open market. However, the stock has already reacted to such development in the yesterday’s market. Notably, despite the recent decline, alumina prices remain above their historical averages. Furthermore, the production cuts by China and Australian miners, are expected to keep aluminium prices elevated going forward. Eventually this will benefit Indian aluminium players such as Hindalco, Vedanta and NALCO in the coming year.
Impact: Neutral