Bauxite Resources looks to establish a new alumina refinery in Western Australia

Global demand for bauxite seems to be on the rise again according to the head of a West Australian exploration company.

Bauxite Resources executive director and CEO Peter Canterbury said global demand for aluminium is a positive for the mining sector in the south west of the state, despite a recent lull in demand due to oversupply.

Aluminium is made from alumina, which is a product of the mineral bauxite prevalent in deposits along the Darling Ranges.

Mr Canterbury said Bauxite Resources is entering into a joint-venture with Chinese company Yankuang Resources to establish an alumina refinery in Western Australia.

Bauxite Resources is also undertaking scoping study and a marketing study of its Fortuna depository. The studies will determine the feasibility of directly shipping bauxite out of Fortuna.

In October 2013 Bauxite Resources withdrew a Public Environmental Review into a Bauxite mining proposal at north Bindoon following the announcement of class action proceedings against the company by action group Residents for Responsible Mining.

Bauxite Resources has confirmed it has no plans to recommence exploration at that site.

WA's most significant alumina refineries are BHP Billiton's Worsley refinery and Alcoa's Wagerup refinery.

Alcoa's Huntly mine near Dwellingup is the largest bauxite mine in the world.

Mr Canterbury said global bauxite demand is being fuelled by China's construction industry and a projected increase in aluminium used by US car makers.

"We're recently seeing that there are re-tooling efforts by the likes of Ford and potentially General Motors to use a higher level of aluminium in cars," he said.

Alcoa noted an increase in 'aluminium-intensive vehicles' in its third quarter report for 2014.

Alcoa's report also pointed to a projected seven per cent growth demand forecast for the bauxite this year. BHP Billiton's 2014 annual report noted a six per cent increase in alumina production.