Revenue earning potential of Vietnam bauxite exports stands high, but there’s a big ‘but’

Indonesia’s stepping back from bauxite export market saw many countries leveraging the opportunity and making it big over the years. Guinea came up in a big way, and there were the quintessential big players like Australia, Brazil, followed by China and India. One country that lagged behind despite owning substantial bauxite reserves was Vietnam. Industry experts opine that the south-east Asian country has huge potential to be one of the top exporters of bauxite, but then, myriad issues have stopped bauxite mining operations from taking off in a full-fledged manner.

As global export-import statics has it, Vietnam’s estimated bauxite export could reach 94907 tonnes in 2016, rising from only 28751 tonnes in 2015. In 2017, estimated bauxite export by the country is likely to reach 1,30133 tonnes.

Revenue earning prospects of Vietnam bauxite exports are also reasonably high. As per trade estimates, value of bauxite export by Vietnam could reach US$4.3 million last year,  up from US$702,331 in 2015. In 2017, value of bauxite export by Vietnam can reach an estimated total of US$5.8 million.

According to experts, Vietnam is endowed with a large amount of bauxite, with estimated reserves of 11 billion tonnes, mainly in the Central Highland region. According to the U.S. Geological Survey data, total bauxite reserve of Vietnam stands at 2.1 billion tonnes, only after Guinea (7.4 billion tonnes), Australia (6.2 billion tonnes) and Brazil (2.6 billion tonnes). It constitutes around 7.2 per cent of the world’s total bauxite reserve of 28 billion tonnes.

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However, Vietnam prefers to mine and process the aluminium ore domestically rather than exporting it to foreign countries. Adding value locally remains the prime focus of Vietnam bauxite industry, but that happens to come at a considerable environmental cost.

According to a recent report by a renowned Vietnamese daily, Dak Nong Aluminium Company in the Central Highlands province of Dak Nong, earned US$50 million from exporting 140,000 tonnes of aluminium and 24,000 tonnes of hydrate so far this year. The company produced more than 240,000 tonnes of aluminium in the period and expects to generate another 230,000 tonnes by the end of this year.

However, it is high time that the country starts considering exporting bauxite to grow economically following an export-to-growth model as that would eventually help it cope with its severe environmental pollution issues.