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Hindalco, Nalco mull price hike

BS Commodities Bureau

Aluminium majors such as Hindalco and Nalco are likely to raise the prices of their basic products in the domestic market by at least Rs 500 a tonne, following a rise in prices on the London Metal Exchange.

Traders say, the rise is expected in early May. They, however, added that this would not lead to any major increase in imports as there were ample stocks in the market and demand too was sluggish.

Aluminium prices on the LME have risen by $50 per tonne since mid-April due to a decline in stocks following the closure of US smelters.

Though officials at both the companies have refused to comment on the price increase, they said a hike was imminent since prices were shoring up on the London Metal Exchange.

Earlier, officials in the Aditya Birla flagship, Hindalco, had said the company would take a decision on the price hike only "in the last week of April or early May."

Hindalco is the largest aluminium producer in the country with an annual production of 240,000 tonne. Nalco follows closely at 230,000 tonne.

Analysts have predicted a dismal growth for the sector in 2001-02 saying "the demand growth may fall six per cent due to a decrease in demand by the automobiles, construction, electrical and transport industries."

They added that this was a temporary phenomenon and demand would pick up once there was an improvement in the industrial production.

The index of industrial production growth slowed to 5.1 per cent in the year to February from 6.5 per cent in the year ago period.

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