Global aluminium price surged by 7 percent during past three weeks

New Delhi (Scrap Monster): Global aluminum price has increased by about 7 percent during the past three weeks. Due to the imbalance in demand supply, it is predicted that the prices will remain higher. The oversupply of the metal for the last eight years resulted in a high deficit which led the price to increase. For example, the world largest aluminium producer, Rusal PLC has got a deficit of about 570000 tonnes during last year. Due to the oversupply condition, the company decided to cut down the production which led to the high deficit and it expects an increase in deficit to 1.4 million tonnes throughout this year.

Accordingly, London High court lined a new rule that has stopped the London Metal Exchange’s plans in order to deliver the metal from the warehouses. As the consumption in aerospace and auto sectors have increased, the demand is also expected to increase by 6 percent. Increased demand together with high deficit will only lead the prices to even higher, this year.

Coming to the case of Indian Aluminium market, it is considered as one among the top producers in the world. Last year was not at all good for India due to the decreased demand from the sectors like construction, power and automobile. As per the data of world Bureau of Metal Statistics, the production and consumption of aluminium has dropped by 8.3 and 8.8 percent respectively. Thus, fluctuations in global price and depreciated value of Indian rupee are likely to have significant impact on domestic aluminium price.