2013-02-24 15:20:05 - Fast Market Research recommends "India Metals Report Q1 2013" from Business Monitor International, now available
BMI View: Indian metals production will hit headwinds in 2013 as market growth moderates in the face of a slowdown in the automotive industry. Producers may also struggle to secure raw material and energy supplies for their operations. That said, the long-term outlook for India's metals sector is very optimistic. We expect India to become a major consumer of metals over the coming years, in line with the country's industrialisation and growth of a wealthy middle class. This will spur production; however, we do not expect production to keep up and this India will become a major importer of metals in the coming years, rather than a small exporter.
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Vedanta's expansion project, which is raising
its smelting capacity from 1.6mn tonnes per annum (mtpa) to 2.5mtpa, along with a recovery in the aluminium market and hope that constraints to growth will be alleviated, should support 35% growth in primary aluminium output to 1.9mnt in 2016. In addition, we have raised our forecast for net exports from 132,000 tonnes to 261,000 tonnes in 2011. Lower levels of domestic consumption than previously forecast should ensure that India maintains a trade surplus in aluminium over the medium term and does not descend into deficit.
Indian refined lead output declined by 9.5% to 151,212 tonnes in 2012 despite Vedanta subsidiary Hindustan Zinc Ltd's (HZL) new 100,000tpa Dariba complex, commissioned in Q312, coming online. By 2013, Indian lead smelting will have reached the limit of capacity. However, consumption will continue to rise, forcing the market to depend on imports, which should reach 75,000 tonnes by 2016.
Production growth strengthened in 2011 after industry leader HZL brought its Rajpura Dariba smelter up to full capacity. India will remain balanced between supply and demand with modest net exports over the next five years. Beyond 2011, the medium-outlook for consumption is broadly positive.
Copper refinery output rebounded in 2012 with growth of 2.1% to 661,600 tonnes largely correcting the downturn in 2010. A positive long-term outlook means that Indian copper prices are likely to remain well supported. Indeed, the sustained growth of the Indian market will help support international copper prices. The expansion of Sterlite's capacity should push output up. This should make India a significant exporter of refined copper, with exports rising to 367,000 tonnes in 2016.
Report Table of Contents:
BMI Industry View
- India Metals
- Steel: Surplus To Decline
- Table: India - Steel Production & Consumption, 2009 - 2017
- Table: India - Steel Industry Historical Data, 2003 - 2010 ('000 tonnes, unless stated otherwise)
- Aluminium: India To Become Major Importer
- Table: India - Refined Aluminium Forecasts ('000 tonnes, unless stated otherwise)
- Copper: Sterlite To Drive Output Growth
- Table: Table: India - Refined Copper Production & Consumption, 2009 - 2017
- Zinc: Consumption Growth To Outpace Production
- Table: Table: India - Refined Zinc Production & Consumption, 2009 - 2017
- Monthly Metals Strategy
- Iron Ore: Holding Up, For Now
- Steel: Bleak Outlook
- Aluminium: Major Gains Over
- Copper: Global Stockpiles Pose Downside Risk
- Lead: Heading Lower
- Nickel: No Return To 2012 Highs
- Tin: Continued Outperformance
- Zinc: Bounce Is Coming To An End
- Table: BMI Commodity Price Strategy
- Table: Select Commodities: Performance & BMI Forecasts
- Steel Forecast
- Table: BMI Steel Forecast
- Table: Steel Forecast
- India Competitive Landscape
- Table: Table: Crude Steel Production Capacity By End-2012 (mntpa)
- Table: Table: Indian Steel Market Share By Major Players (%)
- Table: Table: India - Aluminium Smelters 2012
- Vedanta Resources
- Table: Table: Vedanta Resources - Key Financial Data
- National Aluminium Company (NALCO)
- Table: NALCO - Key Financial Data
- Steel Authority of India Ltd (SAIL)
- Table: SAIL - Financial Data
- India Demographic Data
- Table: India's Population By Age Group, 1990-2020 ('000)
- Table: India's Population By Age Group, 1990-2020 (% of total)
- Table: India's Key Population Ratios, 1990-2020
- Table: India's Rural And Urban Population, 1990-2020
- How We Generate Our Industry Forecasts
- Cross Checks
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