"Malaysian officials have extended the country’s ban on bauxite mining until the end of the year, with the government suggesting this could be extended by a further six months if stockpiles for the ore are not cleared.
The mining ban was first imposed in January, which followed increasing environmental fears surrounding pollution of rivers and the sea by unregulated mining in the country’s leading bauxite-producing state of Pahang. Indonesia’s 2014 ban on the export of unprocessed ores, including bauxite, meant that China, the largest consumer of bauxite for alumina production, turned its attention to Malaysia to fill the supply gap. The country produced an estimated 24.8Mt of bauxite in 2015, shipping the majority of this to China.
The extension of the mining moratorium is unlikely to have a significant impact on China, with Chinese refineries sourcing bauxite from elsewhere. In H1 2016, Australia and Guinea exported a respective 10.5Mt and 4.6Mt to the East Asian country."
AWC Price at posting:
$1.33 Sentiment: Hold Disclosure: Held
