Africa’s largest bauxite producer has chosen the Anglo-Swiss multinational commodity trading and mining company Glencore as the exclusive buyer of bauxite produced by the state-owned Nimba Mining Co., the country’s Minister of Mines and Geology announced.
The move is intended to enable the West African nation to achieve greater direct involvement in the aluminium ore supply chain and reduce exclusive reliance on any single market — particularly China, which currently receives the vast majority of Guinea’s bauxite exports.
“Talks to finalize the terms of the contract are ongoing,” Minister Bouna Sylla said in an interview in the capital, Conakry. While Nimba Mining Co. is a wholly state-owned company, “the aim is to turn it into a mining champion,” he added.
Diversifying the Supply Chain
Guinea currently holds the distinction of being the world’s largest bauxite producer, having managed to produce 183 million tons of the clay-like sedimentary rock last year — most of which was shipped to China.
This supply line has created skepticism within Guinea’s government, which does not want such exclusivity to lead to a slump. As a result, the West African country held a meeting with miners a few months back to determine how to diversify its bauxite supply chain, leading to its current decision.
Expanding Operations
Nimba Mining Co. is branching out into other ventures, including the refinement of iron ore, gold, and metals. According to Sylla, Resolute Mining Ltd. and one of the ventures, Nimba Gold, have executed a memorandum of intent to collaborate on gold prospects.
The additional operations of the new enterprise will be introduced progressively, commencing with exploration and advancing to production.
The company has shipped 4 million tons of bauxite this year and intends to scale that volume to between 8 and 10 million tons for the full year, before reaching 12 million tons in 2027.
The Context
Following a dispute regarding the construction of an alumina refinery, Guinea Alumina Corp., a subsidiary of Dubai-based Emirates Global Aluminum, forfeited its bauxite mining concession to Nimba Mining Co. in August of last year.
Glencore, described as the world’s largest globally diversified natural resource company, will now serve as the exclusive vendee of bauxite produced by the state-owned company.
The Bottom Line
Guinea has selected Glencore as the exclusive buyer of bauxite produced by state-owned Nimba Mining Co. in a move to diversify its supply chain and reduce reliance on China, which currently receives most of its exports. The West African nation, the world’s largest bauxite producer, aims to increase its direct involvement in the aluminium ore supply chain. Nimba Mining Co. is also expanding into iron ore, gold, and other metals. Talks to finalize the contract terms are ongoing.
