40% of US aluminium hydroxide imports come from Brazil, industry warns

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Aluminium hydroxide, a key raw material used across industries ranging from water treatment and aluminium refining to defence manufacturing and liquefied natural gas (LNG) production, should remain exempt from US tariffs to safeguard domestic manufacturing, according to industry representatives.

The material is produced from bauxite before the calcination stage used to manufacture alumina and plays an essential role in numerous industrial processes, including the production of wire and cable insulation, roofing membranes, sealants, automotive components, pharmaceuticals and food products. It is also used in refining high-temperature metals such as rare earths, copper, nickel and zinc.

Limited domestic supply raises import dependence

The US currently has only one aluminium hydroxide production plant and no domestic bauxite mining, making imported material essential to meet demand.

Around 40 per cent of the aluminium hydroxide used in the country is supplied by Hydro's Alunorte refinery in Brazil, while the refinery itself sources approximately USD 300 million worth of LNG annually from Louisiana and Texas and imports around 600,000 metric tonnes of US-produced caustic soda for its refining operations.

Industry groups argue that these trade links underline the integrated nature of the supply chain between the two countries.

Tariff exemption seen as critical

Although the Trump administration recently imposed 25 per cent tariffs on many Brazilian products, aluminium hydroxide was included among the exempted materials following feedback from industry stakeholders.

The National Association of Manufacturers (NAM) had urged the Office of the US Trade Representative to preserve duty-free access to Brazilian aluminium hydroxide, citing its importance for US manufacturing competitiveness.

Support for the exemption also came from companies involved in the aluminium hydroxide supply chain, the Mississippi Rural Water Association and members of Congress.

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Gallium offers additional strategic value

Beyond aluminium hydroxide production, Hydro's Alunorte refinery could also become an important source of gallium, a critical mineral used in semiconductors, defence technologies and other advanced electronic applications.

Initial studies indicate the refinery's bauxite feedstock contains significant gallium concentrations, creating the potential for commercial recovery.

With China dominating global gallium supply, industry groups believe developing alternative sources in allied countries would strengthen supply chain resilience and reduce geopolitical risks.

Industry seeks faster access to critical materials

NAM has also proposed introducing a general licensing system, described as a "manufacturing speed pass", to simplify imports of critical industrial raw materials needed for domestic manufacturing.

"Aluminum hydroxide is a critical raw material that supports manufacturing in America, public health, energy production and national security," said Ryan Modlin, Hydro's Head of North American Affairs.

"Ensuring reliable access to this material is essential for maintaining the competitiveness of U.S. industry and protecting supply chains that millions of Americans depend on every day."

NAM Vice President of International Policy Andrea Durkin said trade measures should address unfair practices while avoiding additional costs for US manufacturers that rely on imported industrial inputs.

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