Bauxite and alumina: A year in review

By Siobhan Lismore-Scott
Published: Friday, 29 December 2017

A roundup of the year’s main events in the global bauxite and alumina markets.

The main non-metallurgical bauxite markets, such as refractories, abrasives and brown-fused alumina (BFA), source their materials in China, where the repeated shutdowns of industrial operations imposed by Beijing due to high smog levels created low availability of product through the year.

Local companies attempted to work through their stocks, but by the end of January, these were depleted.

And supply problems intensified from there. Numerous bauxite and fused alumina plants that did not meet environmental standards were shut down and the operating rates at many of the remaining producers were restrictedThis severely disrupted bauxite and fused alumina output in China, which affected supplies to many refractories in Europe. 

Not only were there stoppages on environmental grounds, but also Chinese white fused alumina (WFA) producers that did meet environment standards were increasing their sales volumes to the domestic market to meet local demand, leaving less material available for the export market.    

The ongoing supply disruption in China pushed many European buyers to seek alternative supply to meet their demand. 

In February, European WFA spot prices jumped due to higher freight rates and production costs.

The disruption also affected the brown fused alumina (BFA) market. Chinese output was hit when the Chinese government started to clamp down on polluting plants in Henan – a main hub of fused alumina production in China. 

Although some production returned to normal in early-to-mid-February following the end of Chinese New Year holiday, many plants that did not meet environmental standards have not reopened, according to market sources.

Further environmental clampdowns

Concerns built up of a renewed wave of anti-pollution checks at the end of February, after the Tianjin government announced further plans to "greatly enhance" the city’s environment in 2017.

As a result, producers rushed to produce as much as possible before any potential disruption, one Tianjin-based trader told Industrial Minerals.  

Fears were realised, when, in March, a wave of mass shutdowns was imposed again on fused alumina and bauxite production facilities in parts of China, following air quality checks by the Ministry of Environmental Protection.

Elsewhere in Shanxi, the local government banned coal-fired energy generation in the provincial capital city of Taiyuan as part of an anti-pollution campaign on March 1.   

Most refractory minerals’ production in China is traditionally powered by coal, but under China’s natural gas policy, industries were only to operate using the natural gas.    

As a result, most bauxite calcining operations to make refractory-grade bauxite ceased.

Tianjin processing plants

As part of the ongoing environmental controls, processing plants located in Tianjin port were forced to relocate in July. Industrial Minerals heard of eight crushing and processing plants around Tianjin port that were forced to relocate, many of which supplied global refractory makers and Europe-based traders.  

Major bauxite supplier China Mineral Processing’s (CMP) plant in Tianjin (see p17) was not affected as the facility met required environmental standards and received government approval to operate.

Imports grow

There was much speculation at the 23rd Bauxite and Alumina conference in Miami, the United States, in March over the extent that China’s reliance on imports would grow.

Even without the pressure of the environmental controls, delegates argued that maintaining the required purity standards of bauxite raw material is becoming harder within China since best-quality ore in known local resources was becoming scarcer after many years of extraction.

This was reflected in the increased need for volumes from outside the country. While China has steadily imported bauxite (around half of national demand is covered by imports), sources claim the ratio of local resources vs imports could change as domestic supply declines.

Australia is expected to strengthen its leading position as supplier of alumina and bauxite to China in the coming years, delegates heard.

Just over half (56%) of all alumina imports into China were shipped from Australia in 2016, Andrew Wood, group executive for strategy and development at Alumina Ltd, told delegates during a presentation.

Monolithics seen as a growth area

This year saw the growth of interest in monolithics, with several refractories companies making moves into this field, or expanding (see box).

"Monolithics are a growth area, and the new plant will enable us to further elevate product quality and consistency," Carol Jackson, senior vice president and general manager at HarbisonWalker International, said. "From a broader perspective, the new plant represents an overall strategy to reinforce our […] position in refractories."

This was a position which was emphasized by John Maxwell, general manager at Calderys, during the 23rd Bauxite and Alumina conference.

Company News in 2017
  • In January, Imerys announced it would divest its newly-acquired Alteo ARC La Bâthie and Beyrède fused alumina operations into an independent business as part of the asset acquisition condition set by the European Commission.
  • Also, in January, Orbite Technologies received its first two customer orders of high purity alumina (HPA) from its newly-opened facility in Cap-Chat, Quebec. However, in April Orbite announced it had filed for a stay of proceedings on creditors under the Bankruptcy and Insolvency Act.
  • Monolithic refractory maker Calderys UK Ltd completed the acquisition of NG Johnson Northern Ltd in February, a UK-based company providing installation and engineering services to the refectory industry.
  • US refractory products supplier HarbisonWalker International (HWI) earmarked $30 million to set up an 80,000 tpy monolithic refractories production facility in Ohio, which is expected to be operational by early 2018.
  • German specialty materials and flame retardants supplier Nabaltec AG acquired total ownership of its US-based subsidiary, Nashtec LLC.
  • Imerys received the "unreserved approval" of the European Commission on its proposed acquisition of French specialty cement maker Kerneos.
  • Alteo increased its specialty alumina products prices in September due to rising raw material costs, citing higher freight rates, and bauxite, caustic soda and energy prices.

More like this