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    Demand from automobile industry increases recycled aluminium production in India - ICRA

  • China Aluminium Network
  • Post Time: 2018/12/3
  • Click Amount: 372

    Aluminium consumption as well as production in the country has been increasing at a healthy rate over the last few years. However, while an increasing proportion of aluminium demand in the country is being met from the secondary (recycled) route from imported scrap, a large proportion of the metal manufactured by the primary2 players are being exported from the country. Usage of aluminium through the primary and secondary routes follow two distinctively different patterns. While more than half of the aluminium through the primary route is consumed by the power transmission and distribution sector, most of the aluminium through the secondary route finds application in the automobile industry.

    Cumulatively over ~42% of the aluminium in India continues to be consumed by the T&D sector as against the automobile industry, sharing the largest proportion of aluminium consumption in the global market. As on date, ~25% of domestic aluminium is consumed by the automobile industry. Going forward, the automobile sector is likely to emerge as one of the prime drivers of aluminium demand in India, as the sector grows and the usage of aluminium in automobiles goes up in line with global trends.

    ICRA estimates that almost the entire quantity of scrap required for manufacturing aluminium through the secondary route is imported due to the unavailability of aluminium scrap in India. Collection of different types of scrap in India is undertaken by the unorganised players, with a nominal quantity out of that being usable by the aluminium industry. On the other hand, most of the recycled aluminium is used by the auto industry, which requires specific auto-grade scrap.

    A large proportion of aluminium in the automobile industry is consumed in the form of various alloys. In the domestic market, as on date, the primary manufacturers have limited capacity to manufacture automobile grade alloyed aluminium products, leading to limited quantity of aluminium alloys being manufactured through the primary route.

    Going forward, as demand for auto grade aluminium increases, import of aluminium scrap into India may increase, unless domestic primary alloying capacity is expanded in tandem with the increase in demand for such products. Moreover, development of products for the auto-industry and securing customer approval is a time-consuming process. Hence, import of auto-grade aluminium scrap vis-a-vis export of unalloyed primary grade aluminium from the country would remain high, at least in the near to medium term.

    Source: https://steelguru.com/
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