New Delhi, April 7 The country's aluminium extrusion sector has significantly reduced its production capacities due to the escalating crisis in West Asia, according to the Aluminium Extrusion Manufacturers Association of India (ALEMAI).
The disruption in global supply chains, triggered by heightened geopolitical tensions in the region, has forced companies to scale back operations from an average annual output of 1.2-1.3 million tonnes, or about 100,000 tonnes per month, to just 50,000-60,000 tonnes currently.
Speaking to reporters on the sidelines of an event here, ALEMAI Secretary Ankur Aggarwal said, "The capacity has been reduced. We have been producing 1.2-1.3 million tonnes on average yearly. We were producing one lakh tonnes every month and it has scaled down to 50,000-60,000 tonnes."
Highlighting the industry's concerns, ALEMAI President Jitendra Chopra said, "India's midstream and downstream aluminium sectors are undergoing a severe contraction, with production declining by 40 to 50 per cent. Despite a strong installed capacity of 4.2 million tonnes, utilization remains significantly below potential."
The sector is currently operating under stress," he said.
The ongoing West Asia crisis has severely disrupted supply chains and energy sources for the aluminium extrusion industry, with 50 per cent of raw materials sourced from the region now facing unloading halts.
The conflict has led to a complete standstill in container unloading at West Asian ports, choking raw material inflows and spiking conversion costs by 25 per cent due to the resultant energy crisis.
Around 30-35 per cent of aluminium extrusion plants have shut down amid LPG supply disruptions, but supplies have partially resumed over the last 5-6 days at 40-50 per cent levels, enabling them to operate at 35-40 per cent capacity due to lingering LPG and PNG shortages.
"There are 100-125 aluminium extrusion plants, which are working at 30-35 per cent capacity only because the raw material supply chain is affected and LPG is not available in full abundance," Aggarwal said.
Speaking during the event, Union Minister of State for Ministry of Commerce & Industry Jitin Prasada said the West Asia crisis is impacting the world economy and India is also being impacted.
He further said inter-ministerial meetings are being held every day to examine the impact on the sector due to the ongoing West Asia crisis, and added that best possible attempts are being made by all ministries to resolve pending issues on ground-level and minimise the impact of disruptions.