Shanghai Nonferrous Metals News
17th May, SMM: China imported 28.41 mln t of bauxite in Q1 2020, up 26.01% on Q4 2019 and up 9.99% y-o-y. Guinea, Australia, and Indonesia consolidated their positions as the top three exporters to China with 13.37 mln t, 9.24 mln t and 4.73 mln t during Q1 2020 respectively. China’s Q1 bauxite imports from Guinea remained at the same level y-o-y while Australia climbed by 22.95% and Indonesia surged by 46.45% y-o-y.
The growth in China’s Q1 bauxite imports can be attributed to increased demand for Guinean and Indonesian bauxite after completion of technology upgrades (HT to LT) at some Shanxi and Henan refineries since Q4 2019. Secondly, falling sea-freight costs have stimulated interest from overseas miners to ship bauxite to China and from domestic refineries to increase their purchases. Additionally, the impact of COVID-19 on domestic bauxite mines resulted in suspensions and slow resumptions, and some domestic refineries have now increased usage of imported bauxite, consequently boosting overall bauxite imports in Q1 2020.
With falling prices of domestic bauxite, caustic soda and coal starting in late March, cost advantages of imported bauxite associated with low caustic soda and energy consumption have been offset by relatively high CIF China prices. As a result, several alumina refineries in Shanxi, Henan and Chongqing have cut operations using imported bauxite – involving approximately 2 mtpy capacity. Looking forward to Q2 2020, the marginal demand from domestic refineries and the prices gap between domestic and imported bauxite will be crucial to the overall import volume.
