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State Minister in the Ministry of Mining and Telecommunications, Laurence Broderick says the Ministry is “actively” seeking to reposition the local Minerals Industry to take advantage of opportunities, while countering existing challenges.
Speaking in the 2008/09 Sectoral Debate at Gordon House on Wednesday (July 9) Mr. Broderick said that as part of the repositioning process, the bauxite and alumina sector, which underpins the local minerals industry, continues to “renew” itself.
“This process is informed by the vision of being involved in the higher levels of the value chain. This must include the possibility of participation in the smelting and extrusion of aluminium products,” he informed.
The State Minister noted that in 1974, Jamaica ranked as the third largest bauxite and alumina producer globally, falling two places by the end of 2006. “Despite setbacks, we are still holding our own. We cannot afford to be complacent. If we do, we will slip further in the league tables,” he stressed.
Mr. Broderick said the sector’s continued competitiveness is being affected by several local and global challenges, which include: the escalating cost of energy and caustic soda; competition from more cost effective producers, changes in the quality of bauxite, and the necessity to more effectively manage the bauxite lands, and reserves.
“Whereas in 2001, the average unit cost of producing a tonne of alumina was US$127.80, in 2008 it has increased to US$330 in some plants. This places us at a disadvantage against several of our competitors, such as Australia and Brazil. Increases in the cost of energy, caustic soda, mining and related inputs are the primary factors that have been responsible for the upward movement in local production costs. At the same time, with larger and newer plants, several of our competitors have moved ahead of us,” he stated.
To this end, Mr. Broderick said the sector continues to implement measures to remain profitable and competitive.
The State Minister also underscored the need to strengthen the research capabilities of the Jamaica Bauxite Institute (JBI), in order to maximize on the derivatives of bauxite ore.
Mr. Broderick pointed out that research and development of the mineral was largely left to the bauxite and alumina companies, stressing that “this is not in our best interest.”
“It is, therefore, necessary that the requisite resources, to afford the research of the chemistry, mineralogy, and processability of difficult bauxite ores be made available to the JBI,” he suggested.
Areas of research which the JBI currently undertakes include: bauxite reserves exploration, and ore processability; use of rehabilitated bauxite roads, and red mud residue; and modelling the underlying economics of the local industry, relative to international counterparts.