India’s demand in the past few months was decimated by the world’s biggest lockdown that was imposed in March. While the measures are now being slowly eased, the country is heading for its first annual contraction in economic growth in more than four decades.
“In the months of April and May, domestic demand was quite low due to the lockdown. This condition is currently mitigated by higher exports by domestic producers,” Pai said in an interview. “Hindalco has exported around 80%-90% of its output in the last two months.”
Higher shipments from India would add to global supplies that are estimated to record a surplus of 3 million tons this year as the virus outbreak hurts demand. Inventories at the London Metal Exchange are near the highest in more than three years and prices have contracted about 11% this year.
Billionaire Kumar Mangalam Birla’s Hindalco produced a record 1.3 million tons of aluminum last year. It exports mainly to South Korea, Malaysia, Taiwan, Thailand, US, Brazil and Japan.
India produced about 3.7 million tons of aluminum last year and consumed a similar amount. Pai, who forecast annual demand growth of 6% to 7% in February, declined to give a revised estimate as the full impact of the pandemic is yet to be ascertained.