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Copper Surge Drives Indian Electronics Makers Toward Aluminium
Copper has become much more expensive, rising 45% in one year.
One reason is that AI data centres and cloud computers need a lot of copper.
Indian electronics companies are therefore trying to use more aluminium in products such as refrigerators and air conditioners.
Aluminium is cheaper and easier to obtain, although its price has also increased.
Companies are responding by changing designs, raising some prices and absorbing some costs themselves.
India is also increasing local production of electronic parts.
Higher prices for new phones helped refurbished smartphone sales grow in the first half of 2026.
PVC pipe makers may benefit from recovering resin prices, unlike electronics companies facing higher metal costs.
The report says building a globally competitive semiconductor industry in India could take decades.
Copper prices have risen 45% year on year, compared with a 28% increase for aluminium.
AI infrastructure demand is tightening copper supplies as data centres and cloud hardware require large amounts of the metal.
Indian manufacturers are substituting aluminium for copper in products such as refrigerators and air conditioners to control costs.
Companies are raising some finished-goods prices, absorbing part of the increase and redesigning products to protect margins.
The report also highlights expanded local component production, rising refurbished-phone demand and projected earnings growth for several electronics companies.
- Who
- Indian electronics and consumer-durable manufacturers, along with companies covered in an Axis Capital report.
- What
- Manufacturers are replacing some copper components with aluminium as copper prices rise, while adjusting prices, designs and sourcing.
- Where
- The changes are focused on India, while copper prices are referenced on the London Metal Exchange and semiconductor exports are reported for South Korea.
- When
- Copper was up 45% over the previous year; the report also cites first-half 2026 refurbished-phone data and August semiconductor-export figures.
- Why
- Demand from AI infrastructure is tightening copper supplies and increasing input costs, making aluminium a more attractive substitute.
Key facts
- Copper price change
- Up 45% year on year; also up 8% over 60 days and 2% over 30 days.
- Aluminium price change
- Up 28% year on year, down 10% over 90 days, and up 7% over 60 days.
- Primary substitution areas
- Refrigerators, air conditioners and other consumer-durable products.
- Local PCBA target
- Pacific Cyber Manufacture Technology Co. is targeting up to 3 million PCBA units in India in 2026, with installed annual capacity of 5 million units.
- Wires and cables investment
- UltraTech Cement has invested $190.5 million to enter the wires and cables business.
- Refurbished smartphones
- India's refurbished smartphone market grew 13% year on year in the first half of 2026, while new-device sales fell about 11%.
- South Korean semiconductor exports
- Exports reached a record $46.65 billion in August, up 209% from a year earlier.
Sources
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