Australian Bauxite targets Indian market to optimize profits from their Binjour project

Australian Bauxite Limited, the Tasmanian miner reported a consolidated net profit of $170,000 in CY 2017, after a net loss of $160,000 in 2016. The chairman and former Labour state premier Paul Lennon says that the miner has potential to become a “significant corporation” and the venture is worth “pursuing aggressively”.

In the company’s annual report, Mr Lennon said they are investing on the R&D of high-value products from the company’s bauxite production and they would plan to build it into “a highly profitable business that is relatively unaffected by the sudden geo-strategic market impacts that have occurred on the seaborne bauxite trade in recent years”.

According to him, the company is targeting niche markets and long-term relationships with reliable customers in order to develop a long term business strategy.

Australian Bauxite has its mines near Campbell Town and has 18 mining areas in Tasmania, New South Wales and Queensland. The report says the company sees no reason behind mining the bauxite reserve if it does not make profits. So, they would sell metallurgical bauxite only when the prices are higher and profitable. Currently they are focusing on supplying to the fertiliser and cement market.

“The current market is improving and ABx is now considering long-term offtake agreements from reliable customers, both for the Tasmanian deposits and for the major Binjour project in Queensland,” the report said.

Looking at the growing ore prices in the first quarter of 2018, the company had started a detailed process of securing an offtake agreement with a reliable customer for Tasmanian bauxite. “Binjour is starting to attract serious interest, especially from alumina refineries in India that are short on bauxite supply while they are expanding their refineries,” Mr Lennon added.

"Our marketing partner, Rawmin Mining and Industries of India, will be instrumental in securing the customers that will be essential for an early development of Binjour.”

The company is rightly targeting the growing alumna market in India as the country’s top aluminium producers are expanding production and looking at bauxite sources to feed their alumina refineries.