The Next Profit Margin in The Alumina Industry-Red Mud
In the absence of new countries to replace China's declining aluminum demand, the era high profit in alumina is expected.
Only the complete utilization of red mud (also known as "the worldwide problem"), which is the expected next profit, can be expected in the case where the alumina manufacturing process hasn't been changed for decades.
The first thing you need to know about red mud
Alumina produces approximately 1.5 tons of red clay, which has a particle size of between 0.088 and 0.25 mm, an average specific gravity of 2.7-9.0, a bulk mass density of between 0.8 and 1.00, and a melting range of 1250-1250 degC. Below is a table that shows the composition of red clay:
The Bayer method is used to produce the majority of alumina in China. The Bayer Method is characterized with high levels of iron, aluminium and alkali.
Second, a case study of the typical alumina company in the utilization of red clay
1. Chinalco Shandong Branch. The data available shows that in 2016, the red mud utilization rate was 25 percent. China's enterprises that produce alumina have a high utilization rate, with accumulated consumption exceeding 12 million mud. Henan Aluminium Industry Transformation and Growth Action Plan (2018-2010) clearly states that by 2020 the comprehensive usage rate of red clay will reach 10%. No harm will come if there is no comparison. China's comprehensive utilization rate is too low. The main uses of mountain aluminum red clay are the development of a new coal-burning de-sulfurizer, high-grade concrete, highway subgrades and brick making.
2. Weiqiao Group, 2018: 20,000 tons of mud red were used to cover the 5.3 km roadbed in the Binzhou section Jiqing Expressway. According to estimates each kilometer of expressway could consume 200,000 tons red mud. Provincial highways can consume up to 60,000 tonnes of red dirt, and municipal road can consume up 20,000 tons. Future market opportunities are wide for countries in China that have a lot of highway mileage.
Third, the case of social forces that have a comprehensive use of red clay
Shandong Satellite TV broadcasted a story on December 31st, 2018 about Zibo Tianzhirun Ecological Technology Co. Ltd. using large amounts of red dirt to produce permeable blocks (consuming 70,000 tons per year). The red-mud permeable bricks project was chosen as one of Shandong Province's top ten innovations for the circular economy in 2018 with a blending rate of 90 percent. The company boss invested 30 million. After Zui, only 2 houses had been studed.
It's not just that Inner Mongolian enterprises have spent hundreds of billions of dollars trying to crack the code on alumina production from fly ash and yet there is no breakthrough.
Fourth, comprehensive red mud usage recommendations
Currently, red mud is more commonly used in the production and roadbeds of bricks as well as for cement. Each has its advantages and disadvantages. There is a cement factory nearby and a high demand for roadbeds. The future demand for permeable blocks is low in economically developed areas. Therefore, it's possible to promote the production of these bricks nationwide. The only disadvantage is the fact that it is more cost-effective to sell bricks within 800 kilometres.
China's red mud alumina is generally used at a very low rate. Our utilization rate may not be as low as that of other countries, but we cannot compare ourselves to foreign countries. China's alumina has entered a new era, one of self-transcendence. We are now maximizing the utilization of red clay. The company's position will be reshaped by the profit margin in the alumina sector.
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