Bauxite

Bauxite is the source of aluminium, a highly versatile material that plays an indispensable role in car-making and many other sectors.

Bauxite

Bauxite ore is the primary source of aluminium, the second most abundant metallic element on earth. Aluminium is a lightweight, malleable and ductile material with excellent corrosion resistance and durability. Aluminium is essential for countless industries, due to its varied uses and applications, which include transportation, construction and packaging, among many others. An increase in the demand for aluminium is expected from the electric vehicles industry.

The largest producer of bauxite is Australia and the world’s largest reserves are in Guinea. China is by far the largest producer of aluminium. TDi’s ESG data indicates that aluminium and bauxite are perceived as strongly associated with pollution and company-community conflict. Perceptions of ESG risks are likely to increase as Guinea – a country with weak governance infrastructure – becomes an ever-more important producer. Aluminium smelting will also come under growing scrutiny due to its greenhouse gas emissions.

Note: Production data in this profile refers to bauxite. The analysis covers both bauxite and aluminium.

Main uses and applications

Aluminium is one of the most versatile metals and, as a result, has a very wide range of uses. Aluminium is commonly used as an alloy, in which it is reinforced by other materials, such as copper, silicon, magnesium, lithium, manganese or zinc, to increase its strength. Some of the superior attributes of aluminium are its low density, non-toxicity, high-thermal conductivity and excellent corrosion resistance. Aluminium is non-magnetic and non-sparking and can be easily casted and formed. It is the world’s second most malleable and the sixth most ductile metal.1http://www.rsc.org/periodic-table/element/13/aluminium However, it does not occur naturally and must be separated from ores – the most common of which is bauxite.2https://www.aluminum.org/industries/production/bauxite

The principal industrial applications for aluminium and its alloys are in:

  • transportation (aluminium-zinc and aluminium-lithium alloys are among the strongest alloys used in aircraft and aerospace applications)
  • automotive industry (offering a higher fuel efficiency performance, due to its light weight)
  • railroads
  • construction and building materials
  • consumer durables (refrigerators, air conditioners, cooking utensils), electrical conductors (electric transmission lines)
  • chemical and food-processing equipment.3https://www.aluminum.org/strength-aluminum

Aluminium is also an important material for the energy transition. Aluminium is used in battery package and as a cathode in Lithium Nickel Cobalt Aluminium Oxide (NCA) batteries.4https://www.ifpenergiesnouvelles.com/article/aluminium-energy-transition-what-lies-ahead-indispensable-metal-modern-world

Supply Chain Risk

Country Governance Risks