Capesize bulker market soars as Chinese bauxite imports spike, claims industry executive

The depletion of China's bauxite production quality and Indonesia's export ban to prioritise its domestic processing resulted in an increasing dependence on Guinea's supply. 

Source: Orbitshub

The rally in demand for capesize bulk carriers is expected to persist for at least another six weeks, fuelled by a surge in Chinese orders for West African bauxite, according to Capt. Sastry, CEO of Adhira Shipping & Logistics and Rainmakers Management & Consulting DMCC

Bauxite prices have climbed sharply—from around USD 73 per tonne in September 2024 to USD 120-USD 130 by January 2025—as a growing fleet of vessels queues at ports along the West African coastline, awaiting cargo destined for capesize carriers.

The CEO of the Dubai-based shipping company stated, "When ocean freight was low over the New Year and Chinese New Year (CNY) holidays, the commodity price went up, encouraging exporters to increase volumes." 

"The bauxite prices were not sustainable at a higher level, and so many smelters postponed shipments until after the CNY holidays."

However, the bauxite prices in China are around USD 95 on average, driven by a renewed surge in demand amid low inventory levels. The uptick is primarily fuelled by strong demand for bauxite imports from Guinea, while a simultaneous increase in iron ore shipments from Brazil has also entered the market.

Sastry said, "This has triggered a spike in demand for capesize vessels and higher indexed (C3) freights that will last well into April and May."

"It is important that mines, carriers and consignees are prepared for these fluctuations and have the support they need on the ground to manage the logistics from mine to port and final delivery overseas."

Guinea is the largest bauxite exporter to China, and it is estimated to have supplied approximately 108 million tonnes in 2024 (Jan-Nov'24). Australia is second, with an estimated export volume of 39.72 million tonnes (approx.). According to China Customs data and the International Trade Council, Guinea exported 100.07 million tonnes of bauxite to China between January and November 2024.

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