Copper Supply Shock Hits India
India faces a copper supply shock after a state government ordered billionaire Anil Agarwal’s Vedanta Ltd. to shut down a plant permanently following deadly protests in a move that will slash nationwide output and stoke demand for imports. The company’s shares fell.
The Tamil Nadu government directed the southern state’s pollution control board to seal the 400,000 metric-ton-per-year smelter in Tuticorin in the interests of the people, it said on Monday 28th May.
The order to shut the smelter will reduce India’s production by about half, spurring imports as industrialization and increased consumption of cars and appliances fan demand. Copper is used to make pipes and wires, and the Australian government forecast last year that India will require vastly more of the metal to feed its economy by 2035. Prices on the London Metal Exchange have rallied 22 percent over the past year, and were last at $6,882 a ton after paring an early drop.
India’s annual copper consumption is expected to almost triple to 2 million tons in the next decade, according to a projection from Hindalco Industries Ltd. Vedanta produced about 48 percent of the country’s total copper output of 842,961 tons in 2017-18, according to government data.
Content by bloomberg.com
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