The move announced by China is seen as a significant development in the global metals market. (Representative Image)
Shares of National Aluminum Company Ltd (NALCO), Hindalco Industries and Vedanta Ltd rose as much as 9% on November 18, following China’s decision to reduce or cancel export tax breaks for select aluminum and copper products. The move, announced last week, is seen as a significant development in the global metals market.
China’s impact on global aluminum supply
China, the world’s largest producer of aluminum and alumina, exports large quantities of semi-finished aluminum products. These export cuts could tighten the global supply of aluminum, potentially driving up prices. This is particularly beneficial for Indian aluminum producers such as Nalco, Hindalco and Vedanta, who stand to benefit from increased demand for their products in a limited market.
Stock performance of Indian aluminum giants
Nalco: The National Aluminum Company Ltd traded on the NSE around 10:25 am at Rs. Its shares gained more than 9% to trade at 240.32. The stock has been bullish since the last two trading sessions. Money Control informed.
Hindalco: Shares of Hindalco Industries also saw a rally, rising 4.57% from its previous close at Rs. 656 per share touched an intraday high.
Vedanta: Shares of Vedanta rose nearly 4% in Monday’s trading, trading at Rs. 450.10, representing an increase of 3.85%.
China’s role in global aluminum exports
Historically, China has played a significant role in the export of semi-finished aluminum products, which are often used in value-added manufacturing processes or remelted into basic forms. The recent decision to limit exports of certain aluminum products may lead to temporary supply shortages, which could further benefit Indian producers.