The market for Aluminium Trihydrate, a crucial flame retardant and smoke suppressant, experienced a marginal price increase in both India and Saudi Arabia of approximately 1% during the first half of August 2024. This surge can be attributed to a combination of increased demand and supply constraints, impacting various sectors and industries.

August 2024 saw a price increases for Aluminium Trihydrate in both India and Saudi Arabia, driven by strong demand and supply constraints. The bauxite ore sectors in both countries are evolving with strategic investments and partnerships aimed at enhancing production and reducing dependency on imports. While demand for Aluminium Trihydrate remains high due to construction and industrial expansions, stabilizing prices will depend on resolving supply issues and improving production efficiencies.

In India, the rising demand for Aluminium Trihydrate was fueled by the current growth in the construction and plastics sectors. The construction sector, buoyed by increased infrastructure projects, which has been stricter fire safety regulations, led to a consistent need for flame-retardant materials. Additionally, the plastics and rubber industries, major consumers of Aluminium Trihydrate, contributed to this demand surge as they expanded their production capacities.

Similarly, Saudi Arabia’s growing construction sector, spurred by its ambitious Vision 2030 plans and large-scale infrastructure projects, significantly boosted the demand for Aluminium Trihydrate. The increased focus on high-rise buildings and public infrastructure further accelerated the need for flame retardants including Aluminium Trihydrate.

In August 2024, India’s bauxite ore (source of Aluminium, required to produce Aluminium Trihydrate) market saw significant advancements with new supply sources and infrastructure investments aimed at enhancing aluminium production capacity. A memorandum of understanding between India’s National Aluminium Company Limited (NALCO), its subsidiary KABIL, and Oil India Limited will bolster the bauxite supply chain. The country’s focus on upgrading domestic production and reducing import dependency is driven by robust growth in the construction sector, which demands more aluminium for high-rise buildings and infrastructure projects. Government initiatives like the Smart Cities Mission and Pradhan Mantri Awas Yojana are further boosting the need for stable bauxite ore supplies.

In Saudi Arabia, the bauxite ore sector is advancing significantly due to economic diversification under Vision 2030. Emirates Global Aluminium (EGA) has shipped the world’s first bauxite cargo using an LNG-fueled vessel, highlighting the Kingdom's commitment to sustainability. Investments in port infrastructure, such as expansions at King Abdullah Port and Jubail Commercial Port, are set to boost bauxite exports. The construction boom, driven by projects like NEOM and the Red Sea Project, is increasing the demand for aluminium. This growth is enhancing the need for efficient and sustainable bauxite mining and processing.

Looking ahead, the Aluminium Trihydrate market is expected to continue experiencing price pressures due to ongoing demand from the construction and plastics sectors, coupled with supply constraints. Both India and Saudi Arabia will need to address production and supply issues to stabilize prices of products including Aluminium Trihydrate.