The global aluminium sector is facing a double whammy of demand uncertainty due to recession fears, and high energy costs due to the ongoing Russia-Ukraine war.
Aluminium prices, after rallying for two fiscals and peaking this March, have fallen by more than 40%. This has put global capacities under pressure and caused some temporary shutdowns. Further, gradual transition to greener energy sources by reducing dependence on coal is creating another flank of strain.
The milieu has impacted domestic aluminium smelters as well, because local prices are linked to global trends.
While the past two fiscals had helped domestic manufacturers forge robust profits, higher energy cost and lower realisation have impacted profitability in the first half of the current fiscal and cloud the near-term outlook.
And this is happening just as smelters have been increasing capacity and efficiency following long-term demand-growth assessments.
So what lies ahead?
To throw light, CRISIL is organising a webinar where its experts will present views on:
Outlook on demand and supply, both global and local
Views on aluminium and raw material prices, and operating margins
Capital expenditure, exports, and leverage trends
Credit outlook for domestic primary aluminium producers
This will be followed by a panel discussion with industry experts and a Q&A session.
Disclaimer: This event and its content are intellectual property and confidential information of CRISIL. Any use of the same without written permission of CRISIL is illegal and hence punishable. Recording the webinar in any form in full or part or copying, altering, distributing or streaming the webinar is strictly prohibited and violation will attract legal action.
