2024 China Bauxite Market Summary and 2025 Trend Forecast

1.Market Overview

In 2024,the price of domestic bauxite continued to rise.Since 2023,multiple factors have led to a significant decline in mining operations in the Shanxi and Henan regions,with many mines ceasing production for rectification.These mines are still undergoing routine inspections,and there has been no significant improvement in mining activities.While some mines have resumed production,releasing a certain amount of bauxite,their contribution to alleviating the supply shortage has been limited due to the large gap in bauxite supply earlier.Meanwhile,the price trend for domestic alumina in 2024 has been strong,which has increased the production and resumption enthusiasm among enterprises,driving strong demand for bauxite and providing substantial support for bauxite pricing.

In addition,bauxite supply in the southern regions has been tighter compared to previous years.In the first half of the year,the tight supply of northern bauxite led alumina companies in the north to procure bauxite from the south,which resulted in a severe outflow of local bauxite resources,thus failing to secure sufficient local supply.In the second half of the year,related policy inspections in Guangxi and Guizhou provinces,as well as strict checks on mining licenses,further tightened supply,leading to price increases in bauxite.With bauxite prices rising across major bauxite production areas in China,the average market price of domestic bauxite also increased,setting new historical highs.

For imported bauxite,2024 saw a continued upward trend in spot prices.Due to the prolonged tight supply of domestic bauxite and the positive price trend for alumina,companies whose production capacity was limited by domestic bauxite shortages gradually turned to imported bauxite to maintain production.Additionally,with new alumina production capacities being released in 2024,the import of bauxite increased,and the Chinese imported bauxite market continued to experience a"supply shortage"situation,supporting higher bauxite prices.Moreover,in 2024,there were occasional disruptions in Guinea,which led to a slower-than-expected release of new capacity.Coupled with the price correlation between domestic and imported bauxite,this stimulated both long-term contract prices and spot transaction prices of imported bauxite to reach new historical highs.

As for sea freight,2024 saw fluctuations in rates.Initially,the increase in bauxite output from Guinea led to a rise in demand for dry bulk carriers,pushing sea freight rates up to around$34/ton by the end of the first quarter.However,as port operations in Guinea slowed and iron ore prices fell,cape-size vessel freight rates decreased.In the third quarter,with the onset of the rainy season and active shipments of bauxite from West Africa,sea freight rates rose again to about$34/ton.In the fourth quarter,unexpected disruptions in Guinea's bauxite shipments led to no significant improvement in actual shipping levels.Weak demand for bulk carriers caused sea freight rates to decline,stabilizing in the range of$18-20/ton.

2.Import and Export Market

In terms of the imported bauxite market,China's imported bauxite situation in 2024 has slightly adjusted compared to the same period in 2023,mainly due to the Indonesian government's ban on bauxite exports,which has eliminated the share of Indonesian bauxite in China's import market.However,with the gradual release of new mining capacities in Guinea and steady inflows of bauxite from countries such as Turkey,Brazil,Ghana,and Laos,the supply gap left by Indonesian bauxite has been filled.Currently,the main supplying countries for China's imported bauxite are Guinea and Australia,with Guinea continuing to hold the dominant position,accounting for approximately 69.9%,followed by Australia at 25%.

In terms of supply volume,in 2024,the total imported bauxite volume reached approximately 157.7 million tons,an 11.34%year-on-year increase.Notably,in August,China's monthly import volume set a new historical high,exceeding 15.5 million tons,with Guinea alone supplying over 11 million tons.According to Baichuan Yingfu statistics,in 2024,China's total import of bauxite from Guinea was approximately 11 million tons,up 9.4%year-on-year.As China's second-largest bauxite supplier,Australia exported a total of 37 million tons to China in 2024,a 15.74%increase compared to the same period in 2023.Among non-major bauxite suppliers to China,the monthly supply levels from Turkey and Laos also showed a certain increase compared to the same months in 2023.

3.Market Forecast

1）Supply Aspect:It is expected that the shortage of domestic bauxite spot resources will continue in 2025.The regulatory control over mine inspections and permit approval processes is unlikely to relax,although it is possible that some mines will steadily advance relevant work and resume production,releasing output.However,overall,under the influence of the broader environment,the supply situation of domestic bauxite will still remain relatively tight.In 2025,the operating rate of inland bauxite mines in China is expected to remain at around 50-60%,with limited room for improvement compared to 2024.

2）Demand Aspect:According to current plans,there is an expectation of some incremental capacity in the Chinese alumina market by the end of 2024 and the beginning of 2025.If these new capacity projects progress smoothly,production will be released in 2025.Significant increases in alumina capacity are expected in the Guangxi and Hebei regions,while Shandong in the north also has expectations for increased alumina capacity.However,based on the implementation of new alumina projects in previous years,there are many uncertainties in the planning process,and the specific progress of these projects will need to be closely monitored.While some companies may temporarily reduce production due to raw material shortages,high costs,or equipment maintenance,overall,China's alumina supply in 2025 is expected to be relatively sufficient.That said,bauxite supply issues have become more prominent in recent years,so it remains important to monitor the actual supply of bauxite to enterprises and its impact on alumina production.

3）Other Aspects:Regarding imported bauxite,the demand from Chinese alumina companies for imported bauxite is expected to remain strong in 2025.Considering that the impact of the rainy season in Guinea in Q4 2024 is weakening and shipment levels are gradually recovering,along with the steady progress of new capacity projects,it is expected that imported bauxite supply will continue to increase in 2025.With the release of new alumina projects in 2025,China's domestic alumina production is expected to reach 88.3 million tons.Given that the proportion of imported bauxite usage by Chinese alumina companies has reached around 70%,the theoretical demand for imported bauxite in 2025 is expected to be 17.5 million tons.However,due to the uncertainty of overseas bauxite supply and the insufficiency of domestic bauxite,the proportion of imported bauxite usage will continue to rise.Overall,the supply and demand fundamentals will continue to support spot prices.

In summary,the supply of domestic bauxite in 2025 is likely to remain tight.Even with the expectation of resumed production,it will be difficult to reverse the overall supply shortage.Furthermore,with the proportion of imported bauxite reaching about 70%,and considering the uncertainty in overseas bauxite supply,Chinese alumina companies will continue to focus on domestic bauxite.It is expected that the average ex-tax price of domestic bauxite will remain between 570-630 CNY/ton(delivered to the plant)in 2025.As for imported bauxite,the demand from Chinese alumina companies will continue to be strong,and the price trend in 2025 is expected to remain relatively firm.The spot price for imported Guinea bauxite(Al45%,Si3%)is expected to range between$85-125 per ton.