Tasmanian bauxite mine suspends production after first shipment stalls

A new bauxite mine at Campbell Town in northern Tasmania has gone into care and maintenance after it failed to secure a buyer for its first shipment.

Australian Bauxite began mining at Bald Hill early last year, in what is understood to be the country's first new bauxite quarry in 35 years. The company started mining about 12 months ago, employing about 30 people. In November, the company announced a deal with Mumbai-based marketing company Rawmin Alliance to purchase 4.7 million tonnes over the next five years.

But Australian Bauxite CEO Ian Levy said it was still unclear when the first shipment would be locked in. "The customers in China are just unable to purchase the bauxite at this time," he said. "Expressions of interest we've got are from China, India, the Middle East and even from Australia, The dates they're all talking about are after Chinese New Year. People are saying once the market stabilises, we'll talk to you again."

A 40,000 tonne shipment of bauxite is sitting at Bell Bay Port, ready for export. There is also another half shipment waiting at the mine.

Mr Levy said the situation was out of the company's control. "There is a considerable amount of uncertainty in the bauxite market right now," he said. "The Malaysian Government has just shut down exports of their bauxite for three months. "In my 40 years in mining, this is the only time something like this has happened. It is extremely frustrating. We may have short-term hiccups, we may have some battles over the next few months but it's worth the effort."

Mr Levy said the uncertainty had affected work at the mine. "Production will naturally have to slow down," he said. "We will continue to do routine rehabilitation work, as and when it's needed. We will try to get back into production as quickly as we can once the market stabilises and once we start getting contracts."

In a statement, the Tasmanian Government said it had been in talks about assistance and the suspension was "regrettable". "The Government has had ongoing discussions with Australian Bauxite in our attempts to assist but the market has proven too difficult for them to continue operations at this time," acting Resources Minister Rene Hidding said.

"The Government will continue to work with Australian Bauxite through the care and maintenance period to do what we can to assist the company and workers through this difficult period."