Trends in Supply

Demand for bauxite is presented in almost all parts of the world as shown in the section «Market Overview» However, only a few regions will ensure market growth in the coming decades. Among them, China and the Middle East.

Potential for export to China

China faces a deficit in bauxite as its requirements for both domestic and imported bauxite continues to increase. As such, in the longer term, imports will have to increase even further in the absence of good quality domestic resources. There are a number of countries that could fill this supply gap. These include Australia, India, Guinea and Jamaica. Although Australia will be a key exporter to China, the quality of Australian bauxite will not allow it to completely fill the void. It is also important to note that imports from Guinea and Jamaica will be at a higher cost given the longer freight distances. Meanwhile, issues with access to bauxite in India on the back of ‘resource localism’ have led to difficulties in securing bauxite for local refineries. Indigenous rights play a huge role in bauxite mining in India and for this reason, India will not be able to supply huge volumes of bauxite to China.

Figure 1 Chinese bauxite imports, mtpa

it is clear that there is a growing market for bauxite exports to China as its import requirement continues to grow. Most of the growth will be satisfied by mines in Australia and Guinea, which substitute import from Malaysia (see Fig.2), and a number of existing and new mines, including potentially Telimele, will compete to supply this market.

Figure 2 Guinea forecast to displace Malaysia over the next five years

Between 2015 and 2025, Australia will supply 14.4m tonnes of extra bauxite to China primarily through the Gove mine, expansions at Weipa/Amrun and a number of new junior miners.

It’s expected that Malaysian reserves will be run out till next 2-3 years.