Norway's Hydro has issued a force majeure notice to its bauxite customers, as it will not receive the full contracted volume from its supplier Mineracao Rio do Norte, due to lower production at the MRN mine in Brazil.
"This will affect Hydro's bauxite deliveries to customers," the company said in a statement. Hydro has 5% ownership in MRN, with an additional 40% offtake in bauxite supply.
MRN, the largest Brazilian bauxite producer, is experiencing problems with its tailing systems due to lack of water, caused by a very dry period in the region, Hydro said. This is expected to reduce production of bauxite from a previously expected level of 17 million-17.5 million mt to 15 million-15.5 million mt in 2017, it added.
As the production shortfall is mostly related to dry bauxite for the export market, production at Hydro's Alunorte alumina refinery is not expected to be affected, it said.
MRN has a nameplate capacity of around 18 million mt/year.
