Aluminium prices to remain low in near-term: ICRA

Prices of aluminium and other non-ferrous metals will remain low in near-term due to the muted demand on the back of uncertain macro-economic environment prevailing globally, ICRA said.

"While prospects for the western economies have improved, concerns regarding slower growth of Chinese economy, largest consumer of base metals, have affected sentiments, leading to subdued price levels at the London Metal Exchange (LME)," ICRA's Senior Vice-President Jayanta Roy said in a release.

Quite similar to the above would be the Indian story as well. The prices of base metal in India are influenced by import-parity prices. The movement of Indian rupee against US dollar would have a critical impact on the domestic prices in the coming weeks.

According to Mr. Jayanta, though aluminium has a better consumption growth rate of about 5.27 in 2013 second half compared to 4% in the first half, prices of aluminium at London Metal Exchange have continued to remain under pressure on the substantial inventory globally.

A deficit in demand supply due to the capacity curtailment of about 2 million tons during 2013’s last two quarters 2013 could save aluminium.

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