We feel optimistic about Chinese demand for imported bauxite

Terra Goyana Miner (TGM) started with the name of Mineradora São Benedito in 1985, working in mineral exploration, mining, processing and commercialization of ores on an industrial scale throughout the national territory. In 1999, a deposit of Bauxite was discovered in the municipalities of Barro Alto, Goias and Santa Rita do Novo Destino of Goias, with a dimension of over 200 million tons.
Asian Metal: Thank you for accepting our interview. Firstly, please give a brief introduction of your company or business.
Leonardo Caldeira: The company started its bauxite operations in Barro Alto in 2013. In 2019, the company became one of the five largest bauxite producers in Brazil (about 5.5% of all Brazilian bauxite production). We conducted deep research on Chinese market in 2020 and established initial cooperation with a major Chinese port, hoping to develop Chinese market in 2021.

Asian Metal: China witnessed growing demand for imported bauxite over the past three years. How do you think of the reasons behind that? And what is your expectation in the coming three years?
Leonardo Caldeira: Chinese local bauxite supply became tight because of the environmental protection policy in China. I think the demand would continue to increase in the coming three years, as the aluminum price is moving up and downstream demand from cars and many other files keeps strong. There would be more alumina plants in China.
Asian Metal: In terms of Brazilian bauxite, what are the advantages and challenges?
Leonardo Caldeira: The quality is better. To produce one ton of alumina normally needs around 2 tons of Brazilian bauxite but more than 3 tons of Guinean bauxite. The content of Al2O3 ranges at 51-60% and SiO2 keeps at 4%max. The freight is high but we could use cape-size vessels.

Asian Metal: As a big bauxite producer in Brazil, how about your production capacity and reserves?
Leonardo Caldeira: The current annual production capacity for metallurgical bauxite keeps at 2.5 million tons and that for calcined bauxite is half a million tons. The reserves reach around 297 million tons for the current mining area. Out target production of metallurgical bauxite for 2021 is around 2 million tons, up from around 1.8 million in 2020.
Asian Metal: Where do you export now? And how about the market share?
Leonardo Caldeira: Right now, we export to France, US and sell the rest in Brazil with the export volume keeping at around 1.2 million tons per year. We learned that the demand from China kept rising from 2019 and would develop the Chinese market. Firstly, we would try to export the first shipment with a volume of around 200,000t and could improve production capacity to export around 1 million tons per year to China if there are more buyers.
Asian Metal: How many bauxite producers in operation are there in Brazil now?
Leonardo Caldeira: Regarding metallurgical bauxite, there are around 5 producers in Brazil now.
Asian Metal: In 2020, bauxite prices went down, following the freight. However, the crude oil cost went up quickly over the past month. What is your outlook on the bauxite price in 2021?
Leonardo Caldeira: I think the bauxite price would go up, as Chinese buyers would buy more bauxite for more alumina plants and they need to find more new suppliers.
Asian Metal: Thanks for joining the interview. The 11th World Aluminum Raw Materials Summit to be organized by Asian Metal on May 21-21, 2021 in Hangzhou of China would help bauxite suppliers to promote their bauxite or services. For the ongoing pandemic, welcome to join the summit by making a video presentation.
Leonardo Caldeira: Thanks, perfect, we are pleased to introduce and promote our bauxite business there.