If we look at the last few years, the consumption of non-ferrous metals has increased steadily. The logic is quite simple. In the begining, any society needs strong infrastructure which is obviously provided by none other than steel. But as the society progresses, its needs also enhance in terms of aesthetic looks, intricacy and diversified applications.
This is why now a days in construction industry, though steel provides the basic strong infrastructure, we see more use of aluminium for the above reasons. Automobile industry case is very interesting. There is tremendous pressure on this industry to reduce weight of the vehicle, increase fuel effeciency and also develop aerodynamic shapes. Many engine parts which were previously made of steel are now been made of aluminium. It is estimated that around 10 % parts by weight are getting converted to aluminium from steel every year. Similar is the case of vehicle bodies and other parts. Here the latest trend is to use composites in place of any metal being used previously. We all know that weight plays more important and critical role in aerospace and telecom industry. Now a days, along with pure metals, a lot of components are being developed out of aluminium and magnesium alloys which are able to reduce the overall weight of the equipment substantially.
While I see a very bright future for non-ferrous metals industry on a long-term basis, the industry is presently facing a rather tough situation. We all know that the metal demand in the developed world is almost stagnated and Asian region including China, India and the Middle East is serving as the growth engine for the global manufacturing sector. With China trying to reduce the overheating of their economy and the Middle East economy hit badly by the oil price crash of last year, India seems to be only promising economy today. Here also the demand is not growing as per expectation and the major metal user sectors like construction, automobile, transport, engineering are witnessing a slowdown. The Demonetisation has also played its part and the GDP growth estimations have come down from 7.6 % to 7.1 % on annual basis.
I do agree that these figures are way ahead than the growth estimates of other regional economies but the fact remains that there is still tremendous untapped potential in Indian economy and I only hope that it steadily comes out in 2017 and the years thereafter!