India will raise export duties on bauxite to help local aluminum producers, which are facing a shortage of the raw material because of mining curbs, Bloomberg reported this morning.
Export taxes on bauxite will be doubled to 20 percent, Finance Minister Arun Jaitley said in his budget speech to lawmakers in New Delhi today. The higher levy will boost local availability for smelters, including those of Sesa Sterlite Ltd. (SSLT), Hindalco Industries Ltd. (HNDL) and state-owned National Aluminum Co.
Prime Minister Narendra Modi’s government, which in May won the biggest Indian mandate in 30 years, is seeking to revive the nation’s metals industry to bolster economic growth from near a decade low, while narrowing one of Asia’s widest fiscal deficits. Environmental concerns and land-acquisition delays have impeded mining of raw materials from bauxite to iron ore, hampering the production of aluminum and steel among other metals used to build infrastructure.
Rising 1.5 percent to close at INR 117.20 ($1.96) per kilogram, the cash price of primary Indian aluminum experienced the biggest change for Wednesday, July 9. After a 0.9 percent increase, the cash price of primary aluminum finished the day on the LME at $1,910 per metric ton. On the LME, the 3-month price of aluminum rose 0.8 percent to $1,942 per metric ton.
Chinese aluminum prices were flat for the day. The price of Chinese aluminum scrap held steady at CNY 12,250 ($1,975) per metric ton. For the fifth day in a row, the price of Chinese aluminum billet remained essentially flat at CNY 13,590 ($2,192) per metric ton. The price of Chinese aluminum bar was unchanged at CNY 14,200 ($2,290) per metric ton. The Chinese aluminum cash price held steady on Wednesday, remaining around CNY 13,400 ($2,161) per metric ton.