India's base metal production for Sep'23 witnesses modest growth barring aluminium

In September 2023, India's base metal production displayed positive trends with the exception of aluminium. Aluminium production inched down by 2%, but other base metals saw significant growth. Copper cathode production rose by 4%, zinc witnessed a 2% increase, and lead production increased by 5%.

In September, India's industrial sector experienced its most moderate growth in five months; however, the expansion remained robust. Remarkably strong demand bolstered business optimism, reaching its peak for the year. The Manufacturing Purchasing Managers' Index (PMI) declined from 58.6 in August to 57.5, reflecting this trend.

Aluminium

In September 2023, India's aluminium production amounted to 3,42,000 t, marking a 2% decrease compared to 348,000 t the previous month. On a y-o-y basis, aluminium production witnessed a slight rise of 2% in September 2023 compared against the corresponding period last year (CPLY).

India's primary aluminium smelting capacity totals approximately 4.1 million tonnes (mnt). The slight drop in production can be attributed to a decrease in demand within the Indian market.

This sector is primarily dominated by key players including Vedanta, Hindalco, Balco, and Nalco. Among these major players, Vedanta, a significant contributor, witnessed a 2% reduction in aluminium production, with their output totaling 1,45,000 t.

Meanwhile, Hindalco's production remained steady at 1,13,000 t, and Balco experienced a 2% decline, resulting in a production level of 48,000 t. Nalco, however, faced a drop in aluminium production, with a notable 5.3% decrease, producing 36,000 t during the same period.

Copper

Copper cathode production in September 2023 saw a 4% m-o-m increase, reaching 49,000 t compared to the previous month's 47,000 t. Similarly, when examining the y-o-y data, copper cathode production increased by 2% in September 2023 compared to 48,000 t in the same period of the previous year (CPLY). Hindalco emerged as the major contributor, with a production of 36,000 t, followed by Sesa Sterlite (Vedanta) with 13,000 t of copper cathode.

A study by the International Copper Association India (ICA India) has shown that in FY 2023, India's copper demand reached 1.52 mnt, marking a significant increase compared to the previous year's 1.31 mnt. In response to this rising demand, refined copper production increased from 485,000 t in FY22 to 563,000 t in FY23. Additionally, net imports experienced an 180% surge, accompanied by a 22% increase in the utilisation of secondary copper (direct melt).

Conversely, India saw a decline in copper ore and concentrates production, with an 8% m-o-m drop, totaling 281,000 t in September 2023 compared to 305,000 t in August. Hindustan Copper Limited (HCL), as the sole primary producer, accounted for the entire production of 281,000 t of copper ores and concentrates in September 2023.

Zinc

In September 2023, zinc production rose by 2% m-o-m to 64,000 t against 63,000 t in August. Similarly, zinc production witnessed a gain of 2% y-o-y from 63,000 t in September 2022.

India's primary zinc smelting capacity stands at about 912,000 t. Hindustan Zinc Limited (HZL) is India's sole refined zinc producer, contributing around 64,000 t in September 2023.

Lead

India's lead production increased in September 2023 to 21,000 t. Notably, lead production surged by 31% y-o-y in September 2023 from 16,000 t in the CPLY.

India's installed capacity for lead primary production is 204,000 t per year. HZL is the sole producer of refined lead with an output of 21,000 t in September 2023.