September 25, 2017 / 5:49 AM / a year ago

Aluminium producer Norsk Hydro warns of Brazil bauxite shortfall

OSLO, Sept 25 (Reuters) - Norwegian metals maker Norsk Hydro has warned customers of a shortfall in supplies of bauxite from Brazil, the raw material from which aluminium is made, it said on Monday.

The Mineracao Rio do Norte (MRN) bauxite mine, where Hydro has five percent ownership and takes almost half the material, is experiencing problems with its tailing systems due to a water shortage caused by dry weather.

“Hydro has issued a notice of force majeure to its bauxite customers as Hydro will not receive the full contracted volumes,” the company said in a statement.

“As the production shortfall is mostly related to dry bauxite for the export market, it is not expected that production at the Alunorte alumina refinery will be affected,” it added.

Alunorte transforms bauxite to alumina, which is turned into aluminium at giant smelters.

MRN bauxite output for 2017 will be reduced by about 2 million tonnes, from a previously expected level of 17 million-17.5 million tonnes to around 15 million-15.5 million tonnes, Hydro said.

The mine, one of the world’s largest, is designed for extracting around 18 million tonnes of bauxite per year.

Brazil is the third-largest producer of bauxite after Australia and China, according to the U.S. Geological Survey. (Reporting by Terje Solsvik, editing by Gwladys Fouche)

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