Rising imports seizing market share of Indian aluminium producer

Despite steady growth in demand in the domestic market, India's aluminium producers are spending sleepless nights, the reason being rising imports eating into their market shares.

The demand for the white metal has been growing steadily at a CAGR of 6 per cent since 2010-2011, driven by increased consumption in the automobile and construction sectors. In 2014-2015, demand grew 6.2 per cent to nearly 2.4 million tonnes (mt). Yet, market share of the domestic producers has declined from 60 per cent to 45 per cent in the last five years.

Imports from China and Middle East are on the rise. A substantial part of these imports is constituted by scrap and waste material. In 2014-15, the share of scrap and waste in 1.563 mt of aluminium imports was 860,000 tonnes. This is adding to the aluminium producers' dismay across the country.

In July Aluminium Association of India took the issue to the Mines and Steel Ministry of India and demanded an import duty hike on aluminium metal and scrap prices. The Ministry has agreed on the issue; but the industry is yet to heave a sigh of relief.

In fact, they are being forced to revisit their ramp up plans and going slow on stepping up production in their newly-commissioned plants. They are focusing more on restructuring and diversification plans to tide over this situation.

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