Economics recast magnesium sector

摘要

Global economic forces can wreak havoc with a metal. This, in part, is what all the hullabaloo over US steel and the American U-turn on free trade is about. But if any metal has felt the cold blast of changing global supply economics in recent years it is magnesium. The impact of Chinese and CIS production on western markets has been enormous. Less than a decade ago China was a net importer of the metal; today it is the world's largest producer, albeit mainly from small inefficient plants. The International Magnesium Assn (IMA) estimates that these two producer regions now have a global market share of more than 40% -excluding consumption in their own markets - much of it in North America. Their prolific output is behind the halving of average metal prices since the mid-1990s (see price chart on p6), and the balance sheets of western producers have been decimated in the face of this onslaught.