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Aluminium Sector Reels Under West Asia Crisis
7 Apr
Summary
- West Asia crisis halts 50% of aluminium raw material supply.
- Aluminium extrusion production capacity reduced by 40-50%.
- LPG and PNG shortages force plants to operate at reduced capacity.
India's aluminium extrusion sector is experiencing a significant contraction, with production falling by 40% to 50% amid the escalating West Asia crisis. This disruption has led to a halt in unloading for 50% of the raw materials previously sourced from the region, severely impacting supply chains.
Consequently, the industry's monthly output has dropped from approximately 1 lakh tonnes to 50,000-60,000 tonnes. Conversion costs have surged by 25% due to the resultant energy crisis and port standstills. Around 30-35% of extrusion plants had temporarily shut down.
Although LPG supplies have seen partial resumption, many of the 100-125 aluminium extrusion plants are still operating at only 30-35% capacity. This is primarily due to ongoing shortages of LPG and PNG, creating sustained operational challenges.
The Union Minister of State for Commerce & Industry acknowledged the global and Indian impact of the crisis. Inter-ministerial meetings are being held daily to address the sector's issues and minimize disruptions.
