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China, the world’s largest producer of aluminium and alumina, exports a large volume of semi-finished aluminium products.
The move announced by China is seen as a significant development in the global metals market. (Representative image)
Shares of National Aluminium Company Limited (Nalco), Hindalco Industries, and Vedanta Limited surged up to 9% on November 18, following China’s decision to reduce or cancel export tax rebates for select aluminium and copper products. The move, announced last week, is seen as a significant development in the global metals market.
China’s Impact on Global Aluminium Supply
China, the world’s largest producer of aluminium and alumina, exports a large volume of semi-finished aluminium products. A reduction in these exports could tighten the global supply of aluminium, potentially driving up prices. This is especially beneficial for Indian aluminium producers like Nalco, Hindalco, and Vedanta, who stand to gain from increased demand for their products in a constrained market.
Stock Performance of Indian Aluminium Giants
Nalco: National Aluminium Company Limited saw its shares rise over 9%, trading at Rs 240.32 per share on the NSE around 10:25 am. The stock has been on an upward trajectory for the past two trading sessions, Moneycontrol reported.
Hindalco: Shares of Hindalco Industries also saw an upward trend, reaching an intraday high of Rs 656 per share, a 4.57% increase from its previous close.
Vedanta: Vedanta’s shares jumped nearly 4% in Monday’s trading, reaching Rs 450.10 per share around 10:30 am, marking a 3.85% increase.
China’s Role in Global Aluminium Exports
Historically, China has played a significant role in the export of semi-finished aluminium products, which are often used in value-added manufacturing processes or re-melted into basic forms. The recent decision to limit the export of certain aluminium products may lead to a temporary supply shortage, which could further benefit Indian producers.
