Global prices of metals, including aluminium, are unlikely to improve considerably in the near term due to uncertainties in the global macroeconomic environment, Icra said on Wednesday.
Besides, energy costs are likely to increase in the second half of the current fiscal, as the domestic e-auction premia on coal is projected to be significantly higher.
"International prices of three non-ferrous metals, viz., aluminium, copper and zinc, have been range-bound and fell by 2-3 per cent in the last two quarters. Such prices are unlikely to improve substantially in the near term owing to uncertainties in the global macroeconomic environment," Icra said in a statement.
The increase in coal costs along with weak global sentiments impacting metal prices remain near-term concerns, Jayanta Roy, Senior Vice President and Group Head, Corporate Sector Ratings, Icra, said.
With an improvement in metal supply, primarily in China, the global metal balance is likely to remain in surplus in 2024 as well, which would limit the price rise in the near term, Roy said.