bauxite and alumina
market overview
Bauxite and alumina market overview
The bauxite market is further growing as limited resources of china are slowly drying up and more and more alumina refineries are dependent on import of bauxite
Leading bauxite exporting countries are Guinea, Australia, Brazil, Sierra Leone, Indonesia and Malaysia.
Some of the Indian, European and other alumina refineries of the world are also importing bauxite, however, quantity is much less compared to Chinese import. Bauxite cost component of alumina production costs is determined by 3 variables;
- Mined cost or procurement price of bauxite
- Transportation cost from mine to refinery
- Bauxite to alumina conversion ratio, mainly determined by available Alminium in Ore - Alumina production costs are heavily dependent on grade of bauxite.
Aluminium Industry Overview
The Changing Structure of the Aluminium Industry
- The development of independent refineries has radically altered the historically, highly integrated, aluminium industry
- Major growth in Chinese aluminium and alumina capacity has broken control; pricing power shifting upstream to alumina and bauxite ore producers
- Result is rising bauxite prices amidst faltering aluminium prices
- Signicant demand for seaborne bauxite has resulted in major mining groups selling bauxite at spot prices
Strong Aluminium Demand = Strong Bauxite Demand
- Medium/long term bauxite demand is driven by strong forecast aluminium industry growth (5.8% per annum 2012-2030)
- Demand growth as emerging economies industrialize combined with growth in transportation, construction, power, packaging and consumer product sectors
- Growth in demand for aluminium since 2000 has outstripped most other industrial metals but aluminium supply has exceeded demand over this time
Global Bauxite Market
- Bauxite is the primary source of Aluminium. The global market continues to grow with global production rising from 137mt in 2001 to 229mt in 2014
- Sierra Leonean production makes up just less than 1 % of this volume. Substantial reserves of bauxite are already proven
- Sierra Leone has 1 billion tones of estimated bauxite resources
- Demand for bauxite in the medium-term will continue to be underpinned by robust economic growth in China and India
- Demand for both crude and dried bauxite is steady per a stable pricing and market mechanisms
- Alumina market demand and prices are stable
- Dependable supply chain will guarantee availability of this much needed metal
