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- Commodity Fundamentals - 2004 Articles


Bauxite

Bauxite is a naturally occurring, heterogeneous material comprised of one or more aluminum hydroxide minerals plus various mixtures of silica, iron oxide, titanium, alumina-silicates, and other impurities in trace amounts. Bauxite is an important ore of aluminum and forms by the rapid weathering of granite rocks in warm, humid climates. It is easily purified and can be converted directly into either alum or metallic aluminum. It is a soft mineral with hardness varying from 1 to 3, and specific gravity from 2 to 2.55. Bauxite is dull in appearance and may vary in color from white to brown. It usually occurs in aggregates in pea-sized lumps.

Bauxite is the only raw material used in the production of alumina on a commercial scale in the United States. Bauxite is classified according to the intended commercial application, such as abrasive, cement, chemical, metallurgical, and refractory. Of all the bauxite mined, about 95 percent is converted to alumina for the production of aluminum metal with some smaller amounts going to nonmetal uses as various forms of specialty alumina. Small amounts are used in non-metallurgical bauxite applications. Quantities of bauxite are also used to produce aluminum chemicals and in the steel industries. Australia, Guinea, and Jamaica are large miners of bauxite.

Supply – World production of bauxite in 2002 rose 5.1% to a record high 144 million metric tons from 137 million metric tons in 2001. The world’s largest producer of bauxite is Australia with 38% of world production in 2002. Other key producers are Guinea (10.9%), Brazil (9.7%), Jamaica (9.1%), and China (8.3%). Chinese production rose sharply by 22% to 12.0 million metric tons in 2002 from 2001, and production has quadrupled in the past 10 years. India’s bauxite production is also rising rapidly and showed an 18% annual gain in 2002 to 9.274 million metric tons, more than triple the amount seen 15 years ago.

Demand – US consumption of bauxite in 2002 rose slightly to 9.970 million metric tons from 9.770 million in 2001. The alumina industry took 93% of bauxite production in 2002, or 9.290 million metric tons. The refractory industry took 1.2% of US bauxite supply in 2002 (115,000 metric tons), the abrasive industry took 0.5% (52,000 metric tons), and the chemical industry took the remainder.

Trade – The US relies on imports for virtually 100% of its consumption needs. Domestic ore, which is less than 1 percent of the US requirement for bauxite, was mined by one company from surface mines in the states of Alabama and Georgia. US imports of bauxite fell to 7.577 million metric tons in 2002 from 8.542 million metric tons in 2001. US exports of bauxite were negligible at 42,000 metric tons, down from 81,000 metric tons in 2001.



*Articles from the Commodity Research Bureau (CRB) Commodity Yearbook. The single most comprehensive source of commodity and futures market information available, the Yearbook is the book of record of the Commodity Research Bureau, which is, in turn, the organization of record for the commodity industry itself. Its sources—reports from governments, private industries, and trade and industrial associations—are authoritative, and its historical scope is second to none. Additional information can be found at: http://www.crbtrader.com/pubs/yb.asp
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