Nalco to be worst hit as it has raised the product's proportion in sales. | |
| The spot prices of alumina, a key input for the aluminium industry, have shown signs of cooling off over the last three-four weeks. |
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| Lowering of alumina prices is attributed to enhanced production levels of the product, coupled with the recent decline in prices of non-ferrous metals. |
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| Among domestic integrated players, Nalco will be affected most by this fall, as the company has been increasing the proportion of spot alumina in its sales. |
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| In contrast, Hindalco uses an overwhelming quantity of alumina for internal consumption. |
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| Analysts at brokerage houses pointed out that spot alumina deals had been struck at about $530-540 a tonne in the last few days compared with $615-620 per tonne, a month earlier. |
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| The spot prices of alumina were pegged at $475-480 a tonne in September 2005. |
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| In the March 2006 quarter alone, Nalco is understood to have sold 1,20,000 tonne of alumina in the spot market. The company had produced 1,72,378 tonne of alumina in Q4FY06. |
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| The weakness in key input prices "� alumina typically accounting for 22-23 per cent of the cost of aluminium production "� also partially explains the recent fall in aluminium prices. |
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| On the London Metal Exchange, aluminium is currently quoting at $2,375 a tonne levels against $3,275 a tonne a month ago, on May 11. |
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| Meanwhile, according to the London-based International Aluminium Institute, total production of alumina in the first quarter of CY06 amounted to 14,140,000 tonne vis-a-vis 13, 872,000 tonne in the corresponding period of CY05. |
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| The global industry body said alumina production in the key Asian region had shown signs of picking up in CY06. |
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| As a result, analysts pointed out, the demand-supply imbalance for alumina was projected to shrink from 13,00,000 tonne in CY05 to 4,00,000 tonne in CY06. |
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