Hindalco, Nalco raise aluminium prices by Rs 2,000 per tonne

Mumbai: Hindalco Industries and National Aluminium Company, two leading aluminium makers in India, have increased the price of the metal by Rs 2,000 to Rs 84,000 per tonne.

The increase is due to firm international prices and a strong local and overseas demand, say Hindalco officials. Aluminium prices on the London Metal Exchange have risen around 7 per cent in 2003, to around $1,469 a tonne.

The scrips of Hindalco and Nalco have been moving up for the past two weeks. It is expected that Sterlite Industries-controlled Bharat Aluminium Company, the other leading aluminium producer, may also increase the price soon.

Both Hindalco and Nalco had increased the prices of aluminium ingots and billets by Rs 1,000 per tonne and that of wire rod products by Rs 500 tonnes since 1 August 2003. Nalco has also increased the price of rolled products by Rs 1,500 tonnes.

According to Imran Contractor of Startup Securities, international aluminium prices are continuing to harden and on 8 October it reached $1,469 a tonne. "Aluminium prices are going up on expectation of a global economic recovery. Then, there is the wild card of China, which is importing large quantities of steel and aluminium. Dollar-denominated aluminium prices are helped by the fact that the dollar has been depreciating against other major world currencies this year."

Industry observes expect a 10-per cent growth in the volume of aluminium to be sold by the two companies during financial year 2004 "Aluminium demand will grow with growth in automobiles and power transmission sectors. Alumina exports are expected to be good. Though aluminium is normally sold through long-term contracts, Indian alumina could be sold at a premium in the spot market to Chinese smelters, who are importing the metal aggressively," say analysts.