India’s Mines Ministry to Consider MIP on Aluminium

India’s Mines Ministry to Consider MIP on Aluminium

India’s Mines Ministry is reportedly soon to take up the question of minimum import prices (MIP) on imported aluminium.

According to a domestic media outlet, an official speaking on condition of anonymity explained that updated findings from Mecon will soon be submitted to the Ministry, at which time it will review the findings and forward them to the Commerce Ministry for final approval.

According to the official, the Mines Ministry asked for Mecon to update its findings using current global prices, and to suggest a new MIP range based upon those findings.

“Mecon had proposed MIP rate of US$2,066 per tonne for primary aluminium products (which includes ingots, billets and wire rods) last month. We have further asked them to look at rates,” explained the unnamed official.

He went on to say that the new report is expected within the next seven days.

In addition to primary aluminium, Mecon initially recommended MIP’s for aluminium tubes and pipes (US$3,108 per metric ton), wires (US$2,349 per metric ton), and aluminium cable and conductors (US$2,403). As the LME price for aluminium has increased by eleven percent since April, there is speculation regarding whether the recommendations from Mecon would be similarly increased.

Earlier this month the Indian government decided against imposing import safeguards against overseas aluminium. According to the announcement, the government did not find sufficient evidence that imported aluminium impacts the domestic aluminium industry’s bottom line.

The Directorate General of Safeguards, which is the branch of the finance ministry charged with making such determinations, said that the evidence before them showed that imports of aluminium have decreased, and the production and sale of unwrought aluminium (sourced both from scrap and from mining activity) has increased.

The Aluminium Association of India has long been asking for a MIP of 15% of the LME’s price on aluminium imports, but as yet to no avail. The Association says that China’s dumping on India’s economy has incurred substantial losses over the past few years, and that the losses are becoming worse. According to the Association, losses were almost three times worse in the just-ended fiscal year than the year previous. It also says that a doubling of taxes on green coal that was instituted around the same time as the above-mentioned increase in custom duties on aluminium have all but wiped out any benefit the increase in aluminium duties may have had.