The impact of Vedanta's copper complex shutdown in Tuticorin is expected to be higher in the domestic market, which may slip into a deficit from a surplus situation, a report said.
The copper plant of Anil Agarwal-led Vedanta remains closed following a Tamil Nadu government order issued on May 28 due to acid spillage from its copper smelter unit in Tuticorin.
As a result of the shutdown, local downstream copper product manufacturers would be adversely impacted due to lack of adequate primary metal in the market, Icra said in a report.
Additionally, Indian premium for import of copper may harden, leading to firmer domestic prices, it said.
On the other hand, an excess supply situation in domestic aluminium and zinc is likely to persist as domestic capacity is high and manufacturers are expected to operate the plants at a high asset utilisation levels. This in turn would lead to large export volumes.
Off-take risks in the international market, however, would remain low, given the expected deficits in the global market and the cost competitiveness of the domestic manufacturers, the note said.
Global non-ferrous metal prices are also likely to remain elevated owing to various issues like ranging from trade sanctions, plant closures, and gradual degradation of ore quality, all of which would contribute to keep metal supplies constrained, Icra said.