Inalum highlights 10-fold value increase from bauxite to alumina, eyes 130,000 jobs in Mempawah

Processing bauxite into alumina and aluminium can significantly increase its value, according to Indonesia's state-owned aluminium producer PT Indonesia Asahan Aluminium (Inalum). The company also expects downstream development to support government revenue, employment and economic activity in surrounding areas.

Arif Haendra, Inalum's director of corporate strategy, business development and commercial affairs, said, "Bauxite priced at USD 40 per tonne can fetch about USD 400 as alumina, a roughly tenfold increase." 

Processing bauxite into alumina costs around USD 250–300 per tonne. Alumina can then be processed into aluminium, which sells for approximately USD 3,200–3,500 per tonne, Haendra said in Jakarta on October 27.

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He said downstream processing could also generate benefits through tax revenue, jobs, transport services and businesses operating around industrial zones.

Mempawah aluminium development expected to create 130,000 jobs

In Mempawah District, West Kalimantan, the development of the alumina-processing industry is expected to create around 130,000 jobs. Haendra said industrial activity was also increasing port traffic and supporting economic activity in nearby communities.

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He added that investment should extend beyond alumina and primary aluminium to the manufacture of products with different specifications and applications.

Aluminium billets, for example, can be processed through extrusion to produce profiles used in buildings. Other applications include electrical cables, automotive components and materials for electric vehicle batteries.

Inalum sees further downstream development as a way to expand the range of aluminium products manufactured in Indonesia and increase the value generated from domestic raw materials.