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Bosnia Alumina Plant, Bauxite Mine Agree on Supplies
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SARAJEVO Jan 18 (Reuters) - Bosnia's sole alumina plant Birac and its main bauxite supplier Boksit on Tuesday clinched a deal to secure steady supplies of bauxite following a December row over prices that had endangered Birac's production.

"The first bauxite supplies will be delivered to Birac today after Boksit and Birac signed a deal on 450,000 tonnes of bauxite feedstock for 2011," the Boksit mine in the northeastern town of Milici said in a statement.

Birac, which gets most of the feedstock from the nearby mine, warned last month it may be forced to halt production unless a compromise solution was reached on the bauxite price which it said was 60 percent higher than on the world market.

Boksit said the deal with Birac was worth 30 million Bosnian marka ($20.4 million). "Today's agreement has set all conditions for the operation of both companies at full capacity," it said.

Birac, majority owned by Lithuania's Ukio Bank Investment Group (UKB1L.VL: Quote), had earlier said that Boksit management demanded a price hike, first of 18 percent and then of 10 percent, on the 2010 price.

It said that Birac in the northeastern town of Zvornik offered Boksit a price "somewhat higher than in 2010" with the condition it got larger bauxite deliveries in 2011.

Birac said in November it had returned to profit last year and increased output by the third quarter of 2010 by more than a third from the same period of 2009.

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