Macro uncertainties led to corrections in aluminium, copper, zinc prices: Icra

Rating agency Icra July 3 said macroeconomic uncertainties led to corrections in global prices of aluminium, copper and zinc in the last one year. It further said that the production growth of these three non-ferrous metals was even lower than the rise in demand.

“Even though international prices of the three non-ferrous metals viz. aluminium, copper and zinc have witnessed corrections of 20 per cent, 13 per cent and 16 per cent, respectively in the last one year, primarily due to macroeconomic uncertainties on the back of ongoing trade wars and other country-specific factors, the fundamental supply-demand balance suggests otherwise,” Icra said in a statement.

While global consumption growth of aluminium and copper during the first quarter of 2019 was muted at 1.4 per cent and 0.8 per cent, respectively, as against 4 per cent and 2.3 per cent, respectively, in 2018, consumption of zinc registered a de-growth of 1.3 per cent as against 0.3 per cent de-growth in the last year.

“Despite muted consumption levels, markets of the three key non-ferrous metals continued to remain in deficit in this period, with shortages in fact expanding on a Y-o-Y basis, as production growth was even lower than the growth in demand,” it said.

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