Mumbai, October 13 (Commoditiescontrol) Coal supply crisis has badly impacted commodities market as aluminium prices have hit a record high amid concerns of its supply. Looming power crisis in India due to shortfall in supply of coal has raised the concerns of blackout. Simultaneously, it has impacted production of base metals like aluminium as coal mines have reportedly stopped supply of coal to the aluminium plants.
Aluminium prices have shot sharply after power crisis emerged in China hit factory output of metals.
In fact, energy-intensive nature of aluminium production is the major reason for its price hikes. Aluminium has the highest emissions per dollar intensity of any metal and each tonne of aluminium takes around 14 megawatt-hours of power to produce. Therefore, with energy prices rising significantly, the cost of producing aluminium has also spiked.
India finds itself in the midst of a power crisis similar to the one darkening China after coal inventories have fallen to just a four-day supply, said a report.
Coal accounts for about 70% of electricity generation in India as out of its 135 thermal plants, 107 do not have enough coal to last more than a week, while 17 have already used up their supply and 21 have only one day left, according to the country's Central Electricity Authority data.
India's power crisis has already hit the commodities market for aluminum, steel, petroleum and other items. State-run coal mines have halted supply of coal to aluminum plants in India, which is disrupting production, said industry body Aluminum Association of India.
The Federation of Indian Mineral Industries also said that an acute coal crunch has created a "precarious situation" for aluminum producers as stockpiles plummet to critical levels.
Aluminium prices rose to $3,118.50 per tonne, all time high on the London Metal Exchange on Wednesday.
(By Commodities control Bureau; +91 9820130172)
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