Orbite sees steady market growth as demand intensifies

The price of alumina is expected to crest and stabilise at about $330/t by the end of the year, buoyed by strong demand from the construction and high-technology sectors, Quebec project developer Orbite Aluminae CEO Richard Boudreault believes.

The alumina market is expected to expand by about 6% a year, while that of more refined high-purity alumina (HPA), is expected to grow by about 15% to 20% a year.

According to Boudreault, one of the strongest trends currently driving up the demand for aluminium, which is derived from alumina, is the construction sector.

When one looks at the construction-materials market in broad terms, aluminium is currently cheaper than wood, owing to the price for aluminium currently being depressed and that of wood rising, as the US housing industry is slowly picking up momentum.

The aeronautics industry is also relying significantly more on aluminium as a light and durable material from which to manufacture aircraft parts. Boudreault pointed to all modern aircraft manufacturers making large-scale use of the material, especially its specialty alloys.

Boudreault also pointed out that high-technology uses for HPA are on the rise, as many countries and local governments are making regulatory adjustments in favour of light-emitting diode lighting to replace the traditional incandescent bulb, further pushing up the demand for alumina.

But, the alumina market is currently flooded, and has forced certain producers using the traditional Bayer-extraction process to shutter smelters and wait until the market turns and the alumina price strengthens.

However, Boudreault is of the opinion that when the markets have regained momentum, it might be too late for a number of these producers to get back on their feet, owing to the implementation of tighter environmental legislation such carbon taxes, and increasing energy prices biting into profits.

And this is precisely where Orbite Aluminae plans to redefine the alumina market, by producing alumina at a negative cost through its proprietary extraction process.

Orbite has developed a process, which would produce HPA from aluminous clay, bauxite, fly ash and toxic red mud – without leaving waste. Boudreault said Orbite’s HPA process is able to produce a host of rare earths contained in the feedstock, catapulting the process into the realm of being an environmental solution for red mud.

Boudreault said Orbite had received “extreme” interest for its alumina-extraction technology from countries such as India – where a number of red mud spillages have taken place – and China.

Meanwhile, the company reported the services, utilities, infrastructure and civil engineering work at its HPA flagship plant being built at Cap-Chat, in Quebec, had been completed and about 80% of the main process equipment was on site, which was ahead of the original schedule.

The plant is expected to start initial commercial production of 4N to 6N HPA in the first quarter of 2013 and the production capacity would gradually increase to three tons a day by mid-2013. As part of the HPA plant design, part of the equipment had already been provided capacity of 5 t a day. The company said it expected to upgrade fully to increased production by the end of 2013.