Growing demand for bauxite highlights risks of dependence on Guinea’s supplies

A bauxite cave in southern Italy.

Global bauxite production is expanding for several reasons including the growing demand for aluminium products. Aluminium, a highly versatile and low-density material, is used in sectors such as automotive, aerospace, construction, packaging and consumer products. Due to the ongoing growth of these sectors, an increase in demand for aluminium and its primary raw material, bauxite, is anticipated. 

Global demand for bauxite is projected to rise by 2.2% to 444.8 million tonnes (mt) in 2024, primarily driven by the expected increase in aluminium demand in China, fuelled by growth in the automotive and manufacturing industries. 

According to Al Circle, in 2022, global aluminium usage, including primary and recycled metal, saw an approximate 1.9% increase, reaching 95.3mt. 

Guinea, Australia, China, Brazil and India were the world's top five producers of bauxite in 2023, accounting for 87.4%, or 361.9 million tons, of the global total.

According to GlobalData’s Global Bauxite Mining to 2030 report, the need for bauxite is mainly influenced by the production of aluminium, which is expected to rise because of growing usage in the transportation, construction and packaging sectors. 

“Bauxite, through its derivative aluminium, is used in manufacturing electric vehicles and various other technologies and industries,” explains Siripurapu Gayathri, senior analyst at GlobalData.  

“Bauxite is essential for advancing towards a more sustainable, low-carbon energy system, including solar panels, wind turbines and battery technologies. As the world progresses towards a low-carbon future, the demand for bauxite and aluminium [will] likely increase, highlighting its essential role in the global energy transition.”

According to the World Bank, aluminium plays a crucial role in the energy transition, supporting many low-carbon technologies such as batteries, carbon storage for low-carbon hydrogen, electrolysers for renewable hydrogen, hydroelectric plants, transmission wires and wind turbines. 

Additionally, it is indispensable for solar photovoltaic (PV) technologies. As things stand now, there would be no solar power without aluminium, which currently makes up more than 85% of most solar PV components. 

The World Bank predicts that aluminium demand will increase by more than 100% in a 2°C climate scenario. Certain projections suggest that the demand for solar PV systems in 2050 will exceed one-third of the current levels.

GlobalData expects global bauxite production to remain relatively stable in 2024, increasing by 1.8% to 421.5mt, mainly due to expected production growth in Guinea and Australia. Additionally, global production is forecasted to grow by only 1.6% in 2025, reaching 428.3mt, attributed to expected consistent production in Brazil, counterbalanced by the rise in production in Australia, Guinea and India.

“The bauxite market outlook from 2024 to 2030 is positive, driven by rising aluminium demand and new mining projects,” said Gayathri. “GlobalData projects that global bauxite production will see only a slight increase, with an annual compound growth rate (CAGR) of 0.4%, reaching 432.4mt by 2030. In contrast, global bauxite consumption is expected to grow at a CAGR of 2%, reaching 502mt by 2030, largely fuelled by the increasing demand from the automotive and construction sectors.”

Based on 2024 and 2030 bauxite production estimates, Guinea and Australia are expected to make the largest contributions to growth in 2024. India, China and Ghana are expected to follow closely behind. In 2024, Guinea is projected to produce 119.5mt of bauxite, which will increase to 130.6mt by 2030. In the same year, Australia's production is expected to reach 103.3mt, increasing to 108.8mt by 2030.

China's bauxite production is forecasted to increase by around 0.2% from 91.4mt in 2024 to 91.6mt in 2030, owing to the expected increases in production from the Aluminum Corporation of China.

Gayathri stated that China usually accounts for more than 70% of worldwide bauxite imports. In 2023, the country imported 141.6mt of aluminium ores and concentrates, a 12.8% increase from 2022. The increase was mainly due to the growing demand for aluminium from the automotive and solar energy industries. 

Similarly, Russia is expected to see a modest increase in production, from an estimated 5.8mt in 2024 to 5.9mt by 2030. 

However, Brazil, currently the fourth-largest bauxite producer, is projected to decrease its production by 39.4% to 18.4mt by 2030 from 30.4mt in 2024. India is expected to increase production with a forecast growth rate of 0.8%, owing to expected increases in production from the Aditya Birla Group. 

Kazakhstan and Jamaica, the eighth and ninth-largest producers, are also expected to see small increases. Kazakhstan is expected to increase from 4.1mt in 2024 to 4.2mt by 2030, and Jamaica from 3.2mt in 2024 to 3.4mt by 2030.

Guinea is set to contribute 28.4% of total global bauxite supply in 2024, with 119.5mt. The main bauxite mines in Guinea, including the SMB-Winning Boke, Sangaredi, Boffa, GAC and Garafiri projects, collectively yielded 79mt of bauxite in 2023, according to GlobalData’s research. 

Following a significant increase in 2023, the country is expected to see a 3.9% growth in bauxite production in 2024. GlobalData states that this growth will largely be driven by the launch of Dynamic Mining’s Bon Ami project in the second quarter of 2024. The project, currently under construction, has an annual production capacity of 4.5mt per year and a mine life of up to 14 years, with an estimated capital expenditure of $138m. 

Additionally, an anticipated rise in production from the Sangaredi, GAC, Garafiri and Boffa mines will further boost the country’s bauxite output. 

“China and Indonesia are prominent players in the global bauxite market, with China being the largest consumer and importer of bauxite. China's dependence on Guinea for bauxite stems from its substantial need for high-quality bauxite to support its aluminium industry, as its domestic reserves are inadequate to meet this demand,” Gayathri said. 

“On the other hand, Indonesia does not heavily rely on Guinea for bauxite. Instead, it has prioritised developing its own mining and refining capabilities to support its aluminium industry and decrease its reliance on imports.”

China's bauxite production is decreasing, and Indonesia has halted exports to prioritise domestic processing, resulting in an increased dependence on Guinea's supply. 

According to media reports, the Aluminum Corporation of China (Chalco) has expressed concerns about the heightened risks associated with bauxite supplies from Guinea, emphasising the growing reliance on a single source for this raw material. 

Last year, Guinea supplied 70% of China's bauxite imports used in aluminium production. Consequently, this situation has left Chalco highly vulnerable to potential disruptions in Guinea. “Our overseas expansion exposes us to political and economic risks, commercial instability and events beyond our control in the countries in which we plan to operate,” Chalco said in its annual fiscal report. 

Some of the risks associated with Guinea mining for bauxite are fluctuations in supply caused by local policy changes and strikes, which can create supply chain uncertainties for countries heavily reliant on imports. 

“Guinea's bauxite supply has been significantly affected by local policy changes, including political instability and government intervention,” Gayathri said. “For example, Guinea's statewide strike on 26 February 2024 impacted the country's key mining operations, including bauxite. Workers sought increased wages, the removal of web restrictions and the release of an imprisoned trade union leader.”