With the closure of Sterlite Copper, which has nearly 35 per cent market share in the country, India will become a net importer of refined copper from being a net exporter so far.
May 29, 2018
The shutting down of Sterlite’s copper plant, which is producing about 45 per cent of the country’s copper output, changes the demand-supply dynamics in the domestic copper market that could escalate the metal’s domestic prices. It makes India a net importer of copper from being net exporter currently. However, for Vedanta’s investors, there will only be a marginal impact as the copper segment of the company contributes only about 5 per cent to the group’s operating profit.
As per the annual report of the Ministry of Mines for FY 2017-18, the key copper players in the Indian market have an installed capacity of around 9.5 lakh tonnes (Hindalco – 5 lakh tonnes, Sterlite Copper – 4 lakh tonnes and Hindustan Copper – 0.9 tonnes).
During FY 2016-17, refined copper usage (including for cathode and wire rod) is around 6.65 lakh tonnes. India has been self-sufficient in refined copper production and has emerged as a net exporter of refined copper so far. But with the closure of Sterlite Copper – which has nearly 35 per cent market share in the country and caters significantly to customers in cable manufacturers, winding wire units and transformer manufacturers – India will become a net importer of refined copper from being a net exporter so far.
