Monthly Summary on Non-Ferrous Minerals & Metals
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No. 3/1/2011-CDN Dated MONTHLY SUMMARY ON NON-FERROUS MINERALS & METALS MAY - 2011 GOVERNMENT OF INDIA MINISTRY OF MINES CONTENTS Page No. Aluminium 1.1 Aluminium 1.1.1 Global Scenario 3 1.1.2 Domestic Scenario 3-4 1.2 Downstream products 1.2.1 Global Scenario 4 1.2.2 Domestic Scenario 5 Copper 2.1 Copper Ores 2.1.1 Global Scenario 5 2.1.2 Domestic Scenario 5 2.2 Copper Metal 2.2.1 Global Scenario 6 2.2.2 Domestic Scenario 6-7 2.3 Downstream products 2.3.1 Global Scenario 8 2.3.2 Domestic Scenario 8 Base Metals (Lead & Zinc) 3.1 Lead & Zinc Ore 3.1.1 Global Scenario 8 3.1.2 Domestic Scenario 8-9 3.2 Lead & Zinc Metal 3.2.1 Global Scenario 9 3.2.2 Domestic Scenario 9-10 3.3 Lead & Zinc Downstream 3.3.1 Domestic Scenario 10 Chapter 4 : Noble Metals 4.1 Gold 4.1.1 Global 10 4.1.2 Domestic 10-11 4.2 PGE 4.2.1 Global 11 4.2.2 Domestic 11 Other Metals (Molybdenum, Cobalt, etc.) 5.1 5.1.1 Global 12 5.1.2 Domestic 12 5.1.3 Rare Earth Element 12-14 Survey, Exploration & Production of Minerals 6.1 Domestic Scenario 6.1.1 GSI 14-15 6.1.2 MECL 15 6.1.3 Production 15 Mergers & Acquisitions 7.1 7.1.1 Indian Acquisitions Abroad 15 7.1.2 Foreign Direct Investments 15 2 Performance of Non-ferrous Metal Sector: 1.1 Aluminium: 1.1.1 Global Scenario: The aluminium prices throughout the month of May, 2011 were swinging due to different factors, like high inventory overhang, power rationing and crude oil prices. Inflation fighting measures in China, mounting debt crisis in Europe, anxious commodity investors dragging down Euro, sluggishness in Chinese buying caused widespread liquidation, dipped the prices to a multi-month low. Analysts believe that with China’s aluminium output making new records in the past few months, sufficient stocks might have built up. It is expected that aluminium prices may see more downward correction in the near future. 1.1.2 Domestic Scenario: NALCO produced 38, 526 MT, sold 30, 338 MT in domestic market and exported 6, 478 MT of aluminium metal in May, 2011. Production of aluminium metal in the public sector unit, namely, National Aluminium Company Ltd. (NALCO) and private sector units, namely, Bharat Aluminium Company Limited (BALCO) {which has 49% Central Government equity}, Hindustan Aluminium Company Ltd.(HINDALCO), Madras Aluminium Company Ltd.(MALCO) and Vedanta Aluminium Company Ltd. (VAL) in the country, during the month of May , 2011 was as follows:- (Unit: Tonnes) Name of Existing May, 2011 Cumulative Cumulative Production the Capacity Production Company Target Production Production April-May, April-May, April-May, Target Actual* 2011 * 2011 * 2010 NALCO 438000 37350 38526 73570 74797 76348 BALCO 245000** 21414 21176 42093 41630 42534 HINDALCO 513500 49328 47664 96824 94130 94235 MALCO 38000 0 0 0 0@ 0 VAL # 500000 Trial run 41869 Trial run 82244 52546 Total: 1734500 108092 149235 212487 292801 265663 National Aluminium Company Limited sold 35, 638 Tonnes of Alumina / Hydrate and exported 6, 478 tonnes of Aluminium during the month May, 2011 # Vedanta Aluminium Limited (VAL) has commissioned its Smelter at Jharsuguda from April, 2008 which is presently under trial production. @ MALCO has temporarily shut down its smelter operations since December, 2008. ** BALCO has closed down its old smelter of 1 lakh tonne per annum capacity and hence the present installed capacity of the company is 2,45,000 tonne. * Provisional Status of Implementation of NALCO’s second phase expansion of Bauxite Mine, Alumina Refinery and Aluminium Smelter (as on 31.05.2011) is as follows: 3 • Revised project cost: ` 4,402 crore. • Financial Commitment ` 4276 crore during April to May, FY 2010-11 (cumulative) • Capital expenditure of ` 26 crore (Prov.) in FY 2011-12, (April, 2010-May, 2011) and cumulative expenditure ` 3,983 crore upto May, 2011. OVERALL PHYSICAL PROGRESS: (in %) S. N. PROJECT SEGMENT CUMULATIVE UP TO MAY, 2011 REMARKS SCHEDULE ACTUAL 1 Mines & Refinary 100 98.7 The commissioning activities for 2 nd Expansion project of Alumina Refinery have commenced on 19.04.2011 by bauxite and liquor charging to Ball Mill. Evaporation Plant Battery H has also been commissioned. The Bauxite will go through various process of refining and final production will come out in June, 2011. In the process of commissioning, teething problem in the system are being attended to. 2 Smelter 100 Complete All 240 pots have been commissioned by December, 2009. 3 CPP 100 Complete Unit # 9 and Unit # 10 commissioned in August, 2009 and August, 2010 respectively. 1.2 Downstream Products The main downstream products are Fused Alumina, Special Alumina / refractory raw material, Aluminum & non-ferrous casting for automobiles, rolled products, wheels extrusions foils, castings, alloys, sections, sheets, home appliances, strips etc. In the past the integrated and secondary players were separate constituents, with little overlap between them. Recently, a spate of mergers and acquisitions has virtually made the downstream segment the preserve of the integrated producers. 1. 2.1 Global Scenario- In the global sector Accuride Corporation a leading manufacturer and supplier of commercial vehicle components in North America, has announced a $13 million aluminum wheel capacity expansion plan. The plan entails the addition of aluminum wheel machining and polishing equipment. 4 1.2.2 Domestic Scenario- Presently , Hindalco is producing different value-added products and services, namely, Fresh wrapp aluminum foil, Everlast aluminum roofing sheets, Permashield aluminum waterproofing membrane sheeting, and Al Planet, an exhibition showcasing aluminum products for the construction industry. Hindalco’s foil business and packaging division (like Superwrap, Freshwrap and Freshpakk semi-rigid containers) delivers versatile solution to meet the multi-pronged needs of customers. It also offer packaging solutions to well-known brands in the pharmaceuticals, healthcare, dairy, confectionery, processed foods, personal products, tobacco industries and also serve the HVAC (heat, ventilation and air conditioning) segments with radiator and AC fin stock. In future downstream projects, National Aluminum Company Limited (NALCO) and the Orissa government formally set up the joint venture (JV) company Angul Aluminum Park at an estimated cost of ` 75 crore. Nalco has 49.5 percent stake and the Orissa government-owned Industrial Infrastructure Development Corporation (IDCO) has 50.5 percent stake. The park would host ancillary and downstream industries like coal tar pitch, aluminum fluoride, aluminum conductors, aluminum castings, extrusion, slugs and circles. Nalco will supply hot metal from its smelter to the aluminum processing units in the park to ensure considerable savings in consumption of power. Similarly Hindalco would set up a ` 1000 crore aluminum downstream project near its existing smelter at Hirakud. The project envisages setting up of rolling mill to manufacture high quality aluminium flat rolled products (FRP) and cans 2.1 Copper Ores: 2.1.1 Global Scenario: World mine production grew by around 1% (28,000 tonnes) in the first two months of 2011 compared with that in the same period of 2010: concentrate production grew by 1.9% while solvent extraction - electro winning (SX-EW) declined by 1.8%. In part, this relative increase reflects operational constraints that reduced production in early 2010 in Australia, Chile and Mexico. Compared with average daily production in the 4th quarter 2010, however, average daily production in the first two months of 2011 was down by 8%. This is reflected in the capacity utilization rate that fell to around 76.5% in January/February from 84% in 4th quarter 2010. World mine production of Copper Ore in February’11 in terms of copper content was 11,76,000 tonnes. 2.1.2 Domestic Scenario: Hindustan Copper Limited (HCL) is the only domestic producer of Copper Ore. The production of Copper Ore during May, 2011 of Financial Year 2011-12 is 2.92 lakh tonnes against a production of 2.89 lakh tonnes during the same period of Financial Year 2010-11: an increase by about 1%. 5 2.2 Copper Metal 2.2.1 Global Scenario: During the first two months of 2010, world refined production remained practically unchanged compared with that in the same month of 2010: Primary production declined by 0.3% and secondary production (from scrap) decreased by 0.2%. Growth in Australia (recovery from low 2010 level), China and Africa were offset by declines in Chile, the United States, Canada and Japan. Refined production capacity utilization in the first two months of 2011 was around 77% as compared to 79% in the same period of 2010. World refined production in February, 2011 was 14,35,000 tonnes. 2.2.2 Domestic Scenario: The size of Indian Copper Industry (consumption of refined copper per annum) is around five lakh tones, which as percentage of world copper market is only three percent. Sterlite Industries, Hindalco and Hindustan Copper are major producers of refined copper in India. India has emerged as net exporter of copper from the status of net importer on account of rise in production. The production of Copper Metal (Cathode) by HCL during the month of May, 2011 of Financial Year 2011-12 is 1795 tonnes, out of which 391 tonnes has been produced through job work. The production of Copper Metal (Cathode) by HCL during the same period of Financial Year 2010-11 was 361 tonnes: an increase by about 397%. As of the end of April, 2011, copper stocks held at the major metal exchanges (LME, COMEX, SHFE) totalled 6,78,241 tonnes, an increase of 1,10,059 tonnes from stocks held at the end of December 2010.