Global production of bauxite is expected to be marginally affected by the temporary suspension of mines due to the COVID-19 pandemic and is forecast to decline by just 0.1 per cent to 344 million tonnes (Mt) in 2020, according to GlobalData.
However, production in Australia is expected to increase by 1.9 per cent to 107.2 kilotonnes (kt) in 2020, accounting for 31.2 per cent of the global total.
The impact of COVID-19 has been limited in Australia, which is the world’s largest producer of bauxite, due to effective measures being taken by governments to contain the spread of the virus across mining regions.
Rio Tinto, the largest bauxite miner in Australia, reported production of 24.8Mt of bauxite in the first half of 2020 – up by 8 per cent year-on-year. This was primarily due to the ramping up of the Arum mine on the Cape York Peninsula in Queensland.
Vinneth Bajaj, Senior Mining Analyst at GlobalData, said in India, the fifth-largest producer, bauxite was exempted from the country’s first 21-day lockdown period, with no major hindrance for bauxite miners thereafter.
“As a result, the country’s bauxite production is expected to increase by 6.5 per cent in 2020.”
Elsewhere, in China, despite mines returning to full capacity by mid-April, the country’s output is expected to fall by a marginal 1.8 per cent in 2020. In Brazil, depleting ore grades will be a key factor behind a forecast 4.2 per cent decline in the country’s output this year.
The spread of COVID-19 has largely impacted small bauxite-producing countries such as Indonesia, Jamaica, Russia, Kazakhstan, Ghana and Guyana. According to GlobalData, collective production from these countries is expected to decline from 37Mt in 2019 to 33.8Mt in 2020. These countries accounted for 10.8 per cent of global bauxite output in 2019, with the share set to drop to 9.8 per cent in 2020.
“Production over the forecast period (2021–2024) is expected to grow at a compound annual growth rate (CAGR) of 2.8 per cent, to reach 387.4Mt in 2024, with Australia, Guinea, and India to be the key contributors. Combined output from these three markets is expected to increase from 226.8Mt in 2021 to 258.8Mt in 2024,” Bajaj adds.
Key projects expected to commence operations during the forecast period include the Kindia project in Guinea, which is wholly-owned by Anglo-African Minerals. With an annual saleable production capacity of 5Mt, the project is expected to commence operations in 2021.
In addition, the Garafiri project, also in Guinea, has completed regulatory approvals and permissions. The project has an estimated development capital expenditure of US$1.4 billion and saleable production capacity of 3Mt per year. It is due to begin construction in 2021 with production to commence in the third quarter of 2022.
