National Aluminum Co announced to have cut the aluminum prices by INR 4,500 per tonne to INR 128,400 on Monday. This decline, effective October 11 is in line with a plunge in international aluminum prices, which lost more than 30% from its peak in July 2008.

According to Mr Pawan Burde metal analyst with Angel Broking, "This is a periodical adjustment that companies do to diminish import threat. However, with a considerable decline in international prices, a 3% decline in prices announced by Nalco shows that the outlook for the base metal is bearish based on troubles in the financial market and rising threats of global slowdown."

Domestic prices are derived from prices on London Metals Exchange, which have seen a decline of nearly 7% last week. Aluminum prices are currently trading at USD 2230 per tonne well below their average cost of production, which is near USD 2700.