Primary aluminium production up 18.2% to 915 KT in Q1: Report

The domestic primary aluminium production has increased by 18.2 per cent to 915 kilo tonne (KT) in April to June quarter on account of better capacity utilisation and addition, a report said today.

Production has increased despite the challenges like coal shortage during the monsoon and increase in the prices of furnace oil, Care Ratings said in its report.

Consumption of aluminium has also risen by 15.1 per cent to 582 KT during June quarter, on development of smart cities, rural electrification, focus on building renewable energy projects and growth in the transportation segment.

On the outlook for the aluminium sector, the rating agency said the country's aluminium demand is set to grow around 5 per cent to 2,200 KT in FY19, driven by the growth in power transmission and the automobile sector.

Demand from the building and construction activities is also expected to pick up due to the affordable housing for all programme, whereas demand from the packaging sector is likely to support the domestic demand.

"The metal also continue to replace copper demand from the electrical and the consumer durable segment," it said.

The production is expected to remain stable at 3,426 KT in FY19, against 3,392 KT in FY18, as all the domestic smelters are now operating at full capacity, it added.

Aluminium exports have risen by 15.9 per cent in June quarter, while imports have declined by 6.9 per cent, according to the report.

India exported primary aluminium to South Korea, Turkey, Mexico, Italy, the US, Japan and Greece, it said.

Globally markets faced a deficit as aluminium demand exceeded supply, Care Ratings said, adding this in turn has benefited India as aluminium is oversupplied in the domestic market.