The share price of the Indian public sector company National Aluminium Company (NALCO) soared to ₹404.30 on Thursday, representing an increase of 8.25%, as the Iran war threatens the global aluminum supply.
NALCO Stock Price Up by Nearly 12%
In the past five days, NALCO’s stock rose by nearly 12%, while in the past month, the share price surged by over 10%. At the time of writing, NALCO—the leading aluminium producing company in India, is trading for s ₹401.50, up by 7.5% from the previous close of ₹373.50.
NALCO’s stock saw significant gains as the worsening situation in Iran disrupted the aluminum supply chain.
Closure of Strait of Hormuz
Following the US and Israel’s decision to launch a joint military operation against Iran, the Iranian Islamic Revolutionary Guard Corps (IRGC) claimed full control of the Strait of Hormuz, one of the world’s most strategically important maritime trading routes.
The IRGC announced the closure of the waterway and threatened to torch passing vessels, effectively halting shipment of goods. The blockade is now crippling major aluminum producers.
Aluminium Bahrain (Alba), a major supplier of aluminum in the Middle East, already suspended deliveries of metal to its customers. The company said that the decision is due to the transit issues in the strait as metal shipments cannot pass through the waterway. The company’s smelter is the largest outside of China.
“The situation in the Middle East remains fluid but we note the region is both a significant producer and exporter of aluminum by sea and also relies on imports of bauxite and alumina to keep smelters running,” said global financial services firm Morgan Stanley, according to Reuters.
Aluminum Price Increase
Spot aluminum price has jumped by 20% to $3,329.3 per ton, the highest since April 2022.
The price increase is largely attributed to supply concerns and trade disruptions linked to the situation in the Middle East.
Source: https://coinpaper.com/15196/nalco-shares-rally-as-aluminum-price-surges-to-4-year-high