ALUMINIUM

World primary aluminium consumption increased to 38.0 million tonnes in CY 2007 or 9.5%, from 34.7 million tonnes in CY 2006, primarily due to increased demand from China which accounted for over 30.0% of global consumption in this period. Consumption is expected to grow at similar levels in the coming year due to higher levels of demand from China and other emerging markets. Global aluminium production increased to 38.2 million tonnes in CY 2007 or 11.0%, from 34.0 million tonnes in CY 2006 and is expected to reach c42.0 million tonnes in CY 2008 due to rapid implementation of new capacity projects in India, China, Middle East, Russia and South America.

The majority of aluminium produced in India is consumed in the electrical, transportation, building and construction and packaging industries. Indian demand for primary aluminium increased at a compound annual growth rate of 13.0% between CY 2002–2007 on the back of high demand from the electrical, construction and transportation sector. Electrical applications continue to be the largest end-use sector in India, consuming approximately 36.0% of aluminium production in CY 2007 as a result of the continuing drive to provide electricity throughout the country. Transport is also a major consumer, contributing approximately 22.0% of demand, although the average aluminium use in Indian-made automobiles is still approximately one-third of that in western-made automobiles. The demand in India is likely to be robust on the back of strong GDP growth and will grow at similar levels.

COPPER 

Global refined copper consumption increased to 17.9 million tonnes in CY 2007 or 2.3% from 17.5 million tonnes in CY 2006, driven mainly by Asian demand, including China, which accounted for 47.0% of global demand and grew 8.4% in this period. Global refined copper consumption is expected to grow to 19.4 million tonnes in CY 2008 on the back of strong demand from Asia. Asia is currently the fastest growing copper market in the world and is expected to grow even more strongly, dominated by use of copper in electric wires and cables.

Global refined copper production increased to 18.1 million tonnes in CY 2007 or 4.6%, from 17.3 million tonnes in CY 2006. Global production is expected to further increase to 18.9 million tonnes in CY 2008, primarily due to the commissioning of new smelters mainly in China, Africa, India and Japan. 

In India, refined copper consumption increased at a compound annual growth rate of 11.0% between CY 2002–2007. It was supported by strong growth in user segments such as winding wires, power cables and other applications in construction, infrastructure and alloy segments. Refined copper consumption in India is expected to grow in line with GDP growth.

ZINC

Global zinc consumption increased to 11.5 million tonnes in CY 2007 or 2.7%, from 11.2 million tonnes in CY 2006, fuelled by strong demand growth in Asia which accounted for almost half of global demand and grew 7.7% in CY 2007. Global zinc consumption is expected to grow to 11.9 million tonnes in CY 2008 at similar rates fuelled by double-digit growth in China, India and other emerging markets. The key growth driver is demand from the steel galvanizing market, which is growing primarily due to robust demand from the automotive and automotive parts industries.

Global zinc production increased to 11.2 million tonnes in CY 2007 or 6.7%, from 10.5 million tonnes in CY 2006, and is expected to further increase to 12.1 million tonnes in CY 2008 due to commissioning of new smelters.

Consumption of refined zinc in India increased at a compound annual growth rate of 8.0% between CY 2002–2007, primarily driven by demand by the galvanising sector, which currently accounts for an estimated 61.0% of total consumption. Galvanising is primarily applicable for sheet, tube and structural products. Applications in the construction and infrastructure sector are also increasing which will boost the overall demand growth in the Indian market.

IRON ORE

Total sea borne demand for iron ore was estimated at 788.0 million tonnes in CY 2007, an increase of 10.4% over 714.0 million tonnes in CY 2006, due to the growth in Chinese steel production. Sea borne supply was 774.0 million tonnes in CY 2007, an increase of 7.6% over 719.0 million tonnes in CY 2006. Sea borne demand is forecast to remain robust and grow to c840.0 million tonnes with supply expected to remain tight, in CY 2008.