February 2016, Issue #2

IMA News

Below are articles and summaries of magnesium related stories. IMA Member companies are asked to distribute the IMA News to their employees. IMA member company employees wishing to receive the monthly IMA News issues should send their email addresses to the IMA World Headquarters. We appreciate all member company press releases and announcements for inclusion in the monthly IMA News issues. Please send your news to info@intlmag.org.

February 2016, Issue #2

73rd Annual World Magnesium Conference - Registration Now Open!

Global Automotive Lightweight Materials Europe Congress 2016

IMA Promotional Video Opportunity

Expert Network on Critical Raw Materials

EU DG GROW Material Analysis Flow Study (MSA)

CRM Alliance Update

JMA December Magnesium Newsletter Japan

December China Magnesium Industry and Market Bulletin

Member News

Industry News

Upcoming Events

73rd Annual World Magnesium Conference-Registration Now Open!

Registration is open for the International Magnesium Association's 73rd World Magnesium Conference happening May 15-17, 2016 in Rome, Italy. This is the top event for magnesium professionals and will benefit all in the industry. Whether a metal producer, recycler, foundry worker, fabricator, end-user, or supplier, attendees will walk away from the conference having had a great time meeting, learning from, and spending time with other professionals just like you.

Click here to register!

Technical Sessions
Technical sessions are a chance to hear more about current and developing matters within the industry. There are excellent speakers lined up, like Karen McBeth from Platts Metals Group, Werner Frager from AMAG-Austria Metall GmbH, Alan Clark from CM Group, and Takaharu Suzuki from Yamaha Motor Co., Ltd. Here is a sneak peek of just a couple sessions you will want to attend at this year's convention:

Requirements on aluminum for qualification as material for automotive components
Werner Frager, AMAG- Austria Metall GmbH

Aluminum is known as a recyclable product, but what are the requirements for those recycled products to qualify for automotive components? Join us for this session to see how suppliers can reach these demands.

Global Primary Magnesium Supply and Demand Balance 2015
Alan Clark, CM Group

Alan Clark offers insight and analysis in the global primary magnesium industry and the current challenges it's facing. Topics such as global demand, changes in government regulations, and forecasts for the future.

Exhibit Showcase
The 2016 Showcase brings the best innovations, products, and services to the forefront. GF Automotive, Meridian Lightweight Technologies, Musto et Bureau S.r.l., Shanghai Regal Metal Materials Co., Ltd, and W. Pilling Kesselfabrik GmbH & Co.KG are set to generate interest, demonstrate their commitment to the industry, and increase their visibility as exhibitors.

We are grateful to our sponsors for helping to make this year's event a success. AMACOR, RIMA Industrial, and US Magnesium have been very generous in their contributions and we are still looking for others who want to be involved as a sponsor. Click here for more sponsorship information take this opportunity to promote your company.

That's Not All!
We've only described a few items on the agenda for the IMA World Conference. Other highlights include industry update discussions, Awards of Excellence presentations, networking opportunities, and an opening President's Reception. You do not want to miss a moment of the premier international magnesium industry conference. Visit the conference website here to find out more and plan your trip today!

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The 5th Annual GALM Europe 2016 edition is coming to Birmingham for the first time to bring back its legacy of the most up-to-date practical case studies, and present innovative weight and cost reduction solutions for the European automotive industry.

This is the largest and most trusted lightweight materials congress and is supported by Audi, Jaguar Land Rover, Lamborghini, Bentley, Tata Motors
And Other Leading OEMs

The pressure from Governments and the global community to cut down on CO2 emissions has been a cause of significant headache for the global automakers for a while now.

The need to cut vehicle weight is obvious and there are several solutions to consider. With the set of new materials and grades rolling out on a continuous basis, advanced lightweight materials adoption keep gaining momentum, yet the selection and adoption processes become a costly trial and error method at times.

To be able to compete effectively on the global automotive arena the European OEMs are in need of the mature cost effective solutions that will allow them to roll out more lightweight cars out of their assembly lines, adopting the designs and manufacturing practices to reflect changing consumer demands and global emission standards.

To help OEMs deliver the next generation of lightweight vehicles, the 5th GALM Conference Europe is returning on April 26-28th 2016 with its legacy of bringing the latest OEM-led case studies and innovative solutions from the material and technology providers to the critical audience of the automotive experts.

Exploring The Availability Of New Materials, Examining Their Properties And Performing Lifecycle Analysis To Define The Latest Changes To The Automotive Lightweighting Scene

Understanding How Manufacturing Process Can Be Simplified To Achieve Robust Performance And Cost Savings And Comparing New Joining Technologies For Multi-Material Designs

Examining Composite Processing Breakthroughs, Material Availability And Parts Integration Into Medium To High Volume Vehicles To Assess Business Case For Their Adoption

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IMA Video Promotional Opportunity

This year IMA embarked on a new Industry Promotion program geared towards increasing awareness of the Association and our wonderful material MAGNESIUM!
We have begun by rebranding the Association with a new logo, marketing banners and literature to be used and distributed at relevant industry events. We have also identified several events, both in Europe and North America, which we will attend in 2016 to continue our promotion work that started this year. One exciting event will be the 2016 Hannover Fair in Germany where we will partner with the German research institute HZG to display a car demonstrator showing where magnesium parts can be utilized in auto construction.

Consistent with our rebranding effort, the Board has also agreed to begin production on an IMA video to promote our material and the Association. Our key messaging in the video will be:

"Magnesium is an extremely abundant metal with tremendous light weighting properties, an environmentally friendly material fully recyclable, and with the same processing versatility as other non-ferrous metals."

Key Market Sectors and Products we would like to feature in the video are as follows:
  • Primary pure ingot for the aluminum industry
  • Recycled alloy ingot - die casting
  • Die cast parts for automotive and other applications
  • Sand cast parts for aerospace
  • Extrusions, forgings and sheet in multiple applications
  • Magnesium powder, chips/steel desulphurization, agro chemicals and pharmaceuticals
  • Bio absorbable alloys for medical applications
  • Research & Development: Universities and research Institutes new applications and processes

We are reaching out to our members to rally support in our efforts to produce the video. We are looking for anyone interested in providing a short video clip or photographs that are visually impressive and would fit into one of the above product or market sector categories. Alternatively, you can support the production financially. For sponsorship opportunities please contact our office at info@intlmag.org or (847) 416-7214.

All sponsors will be acknowledged in the credits at the end of the video with your company name and logo. Clearly this will be an opportunity to promote your company as we plan to release the video widely throughout the industry and its customers but also utilize social media such as YOUTUBE! The production will also be HD QUALITY and as such, suitable for use on a wide range of media, large screen projection, booth displays, web streaming, PowerPoint presentations, etc.

When submitting any clips or photographs please ensure to follow the guidelines below. Also please ensure you have full copyright to use any images in this way.
Video Specification: Video should be supplied as original source files as they were shot-as Apple Pro Res/DNXHD/uncompressed files in H264 Format. All video must be clean with no graphics/text overlays.

Photograph Specification: High resolution TIFF and/or PSD, with a pixel size of 3840x2160.

Company Logos/Brand identities: Brand logos should be supplied as a vector EPS file.

As clearly the size of these digital files will be large and not suitable for transmission just by email we have set up a link where you can upload your suggested contribution https://www.hightail.com/u/Psigsworth. When doing so please also specify the market/product sector and a brief description of what is being shown.

We hope you will join us in this exciting initiative as it will be a beneficial tool in marketing Magnesium as the material of choice and also promote the IMA to potential members.

Please let me know whether you wish to take up the sponsorship offer but also even if it is not something you want to follow up on I would also like to know.

Thank you for your continued support of the IMA during 2016 and we look forward to welcoming you to our next World conference in ROME next year.

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Expert Network on Critical Raw Materials

In the forefront of the looming deadline for application, two applicants merged, and as a result the number of consortium members got quite large. After all, it was decided to exclude all associations from the consortium, and as a consequence also from direct access to EU funding. In reaction, CRM Alliance did withdraw from the project, and took the position to wait after the call is granted later in the near. Nevertheless, the Expert Call on Critical Raw Materials is very substantial for EU policy making and improving knowledge about CRMs in the "first row" at all stakeholders in Brussels. However, other associations signed the supporting letter, such as Eurometaux, Euramines, but we cannot expect direct and detailed support for magnesium. IMA is consideing joining the Expert Network on its own. The deadline for such a supporting letter is end of February.

Expert Network on Critical Raw Materials (2016)
The proposed action should develop primarily an EU expert network or structure of networks covering all CRMs and where possible, include the stakeholders covering as much of the value chains as possible. 34 In case the new list will not be available at the deadline of the call, proposals should demonstrate the flexibility of incorporating new CRMs in the scope of the project. Proposals should build on the experience and knowledge gained from similar initiatives such as the ERECON 35 a network on Rare Earth Elements, and CRM_InnoNet.

In order to support decision making of the producers and users of raw materials and the policy makers the projects should cover all the following points:
  • map, comprehensively assess and quantify estimated amounts of existing primary and secondary sources of and alternatives to the different CRMs.
  • estimate the expected EU demand of various CRMs in the future and identify major trends;
    provide policy and technology recommendations for actions improving the
  • production of the various primary and secondary CRMs and actions for their potential substitution, in order to secure their supply and decrease the relative dependence upon their imports;
  • provide a plan for transparent consultation with relevant external stakeholders and effective communication of the findings to the professional and general public across the EU;

In the case of secondary CRMs, the mapping information on Waste Electrical and Electronic Equipment (WEEE) and waste batteries and other relevant end-of-life products within the EU is crucial, as well as the need to contribute to the further development of European standards for the treatment of WEEE in order to optimise the recovery of CRMs, identifying the most relevant WEEE categories and additional standardisation needs for the further development of CENELEC standards under the European Commission Mandate M/518 EN.

Climate action, environment, resource efficiency and raw materials The Commission considers that for this sub-topic, proposals requesting a contribution from the EU of up to EUR 3 million would allow this specific challenge to be addressed appropriately. Nonetheless, this does not preclude submission and selection of proposals requesting other amounts. Up to one action for this topic part shall be funded.

Click here for more information on the Draft Horizon 2020 Work Programme 2016-2017 in the area of Climate action, environment, resource efficiency and raw materials.

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EU DG GROW Material Analysis Flow Study (MSA)

The "Study on Data for a Raw Material System Analysis: Roadmap and Test of the Fully Operational MSA for Raw Materials" was published by the EU Commission on 15 Nov 2015.

CRM Alliance and IMA were contacted and invited to work closely with the lead authors of the study, but beside comprehensive support and information provided, at the end the study resulted in absolutely negative results for magnesium. The CRM Alliance is currently collecting feedback from all its members to come up with a joint reply to DG GROW and JRC (EU Commissions Join RESEARCH CENTRE). In addition to providing input for CRM Alliance, IMA decided to respond directly (but in-officially as first step) to DG GROW.

To name an example; "In view of creating and sustaining "circular economies" it is important to limit landfill to a minimum level. In the named MSA study, the annual amount of Mg landfill is listed with a surplus of 114.000 mt per year. The overall consumption of Magnesium within the EU is named at 150.000 mt within the investigated period. That would mean that more than 75% are going to landfill in a linear mass flow analysis. This assumption is completely wrong and would take away any credit what Magnesium claims for an excellent product for a circular economy. The accumulated stock of 2.8 million tons, considered perhaps as recoverable deposit, is also completely misleading."

The main objective of the project is to respond to the needs of information on non-energy material flows and to assist the European Commission on the development of a full Material System Analysis (MSA) for several key raw materials in the European Union. For each material, the MSA consists of:

  • a map of the flows of material through the EU economy, as raw materials or as parts of basic materials, components or products, in terms of entries into the economy (extraction and import), movements through the economy (production, consumption, export), additions to stock, and end of life,
  • with additional information related to security of supply (company concentration, country concentration...), substitutes, future supply and demand changes of materials.

The MSA includes the entire life cycle of materials, including exploration, extraction, processing, manufacturing, use and end of life through either disposal or recovery. The raw materials studied in this project are listed in the table below. They include:

  • the raw materials considered as critical for Europe (indicated with a * in the table).
  • lithium, which is currently not included in the list of critical raw materials but which is a borderline case,
  • and aggregates. Contrary to other materials studied in this project, aggregates are mostly supplied at a local level and are not considered as critical raw materials. However, the big flows of aggregates in Europe, the important number of small companies involved at the different life cycle steps of these materials and the economic importance of the construction and building sectors in the European economy make of aggregates an interesting case study.

This project is the follow-up of the Study on Data Needs for a Full Raw Materials Flow Analysis mentioned above and shall implement its recommendations. The main challenges are to fill the data gaps and remove the bottlenecks of the data flows, either by finding data sets or developing appropriate modelling.

More precisely, the project aims to provide:

  • a complete overview of existing data sources adapted or workable for MSA in Europe, with a specific examination of the Eurostat data base on trade of goods from the viewpoint of its usability for MSA,
  • a detailed methodology on establishing MSA in Europe,
  • a complete MSA for the 28 studied materials, with detailed data sources, assumptions and calculations and with main data gaps filled with experts' inputs gathered through direct consultations and organisation of workshops,
  • recommendations for the maintenance and update of the MSA.

The outcome of the project will be made available in a database (with secured access) developed by the European Commission that will help identifying key opportunities to secure supply of non-energy resources in Europe.

For complete details on the study click here.

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CRM Alliance Update

Memorandum: Circular Economy's Impact on Critical Raw Materials:
The CRM Alliance drafted a memorandum about the impact of the EU Circular Economy Package on CRMs. A draft is sent to the members for feedback. It is expected to be published after the CRM Alliance meeting in March.

MSA Analysis feedback:
The CRM Alliance asked its member base for individual feedback of the MSA study, published by the Commission in November 2015. It is also expected that the CRM Alliance will publish a combined feedback and position to DG GROW.

Member of European Parliament Interest Group - MEP
The CRM Alliance has been working to form an interest group for CRMs among interested members of EU parliament. The work is almost completed and there will be an introduction during the CRM Alliance lunch event on 15.3.

Visit www.criticalrawmaterials.org for the latest CRM Alliance Information & Events

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JMA Magnesium Newsletter Japan
Vol 38. Covering the news for December 2015

The Japan Magnesium Association


News in Japan
  • Yamaguchi University's graduate school has developed a high-capacity magnesium secondary battery
  • Fuji machine MFG has adopted high-damping magnesium to advance the performance of mounters
  • Suncast has changed the material of case of external power supply for cardiac pacemaker to magnesium
  • Miyamoto Seisakusho plays a part of environment-friendliness by magnesium cleaning substance

News in Japan

Domestic Magnesium Market December, 2015

Yamaguchi University's graduate school has developed a high-capacity magnesium secondary battery
(Source; ALUTOPIA, Jan. 2016)

The research group of Yamaguchi University Graduate School of Science and Engineering (Science and Engineering; Kazuhiro YAMABUKI, assistant professor, Medicine; Hiromori TSUTSUMI, professor, Science and Engineering; Nobuko YOSHIMOTO, associate professor) succeeded to develop a high-capacity magnesium secondary battery. It is hoped that it will be alternative of the conventional lithium-ion battery.

The secondary battery is a rechargeable battery, and it consists of three elements, those are positive electrode material and negative electrode material which serve as energy source, and electrolyte which is a medium for energy between electrodes. In current secondary batteries for cell phones, cobalt compounds are used as the positive electrodes and artificial graphite as the negative electrodes, and organic electrolytes with lithium-ion are used as electrolytes. The energy is generated by the reaction of lithium-ion with the positive electrode and the negative electrode. Since cobalt and lithium are rare metal and very expensive, and the travel distance is shorter than gasoline vehicles, there were problems to familiarize large capacity batteries for electric vehicles.

To solve these problems, they use magnesium for the negative electrode and sulfur for the positive electrodes instead of cobalt and lithium. Since magnesium is bountiful resource, not expensive and safety when it is used as the electrode and it has high energy density, it is expected as the material which replaces lithium-ion battery. But if it is used as the negative electrodes, there were some problems that it needs high temperature and there were no positive electrode material with high energy density.

The research group focus attention on sulfur which is bountiful resource, not expensive, and has high energy density same as magnesium. They made organic sulfur by chemical reaction, and used it as the positive electrode. They solved the problems by using it. They succeeded to develop magnesium-sulfur secondary battery not reported in the world.

Current situation is in the fundamental research stage, and it needs to be checked stability in long term use. It is expected to use in human life and medical care.

Fuji machine MFG has adopted high-damping magnesium to advance the performance of mounters
(Source; "Sokeizai Tsushin", 1st Jan., 2016)

Fuji machine manufacturing Co., Ltd. has developed a new model of mounter "AIMEX II C". Mounters are main equipment widely used for assembling of electric devices. There are increasing demands for high-mix low-volume production and high productivity per area in electronic substrates mounting processes. The company has actualized high productivity per area and high operability in addition to flexibility and expandability by inheriting the concept of former model "AIMEX II S" which was released in the end of 2012. Magnesium being light weight and having high damping property is applied to the movable component.

Suncast has changed the material of case of external power supply for cardiac pacemaker to magnesium
(Source; "Sokeizai Tsushin", 1st Jan., 2016)

Suncast Co., Ltd. exhibited the case of external power supply for cardiac pacemaker at "Monodukuri Matcing JAPAN2015". The material is magnesium alloy. This is produced by die-casting. The part in use is the external power supply for the cardiac pacemaker which provides stability of the pulse of the heart. The reason is light weight. The users of cardiac pacemaker are increasing and the weight saving is progressing.

Miyamoto Seisakusho plays a part of environment-friendliness by magnesium cleaning substance
(Source; "Sokeizai Tsushin", 1st Jan., 2016)

Miyamoto Seisakusho Co., Ltd. works on magnesium with all its force. They produce cleaning substances, head gears which protect temporal part of heads of boxers, and emergency lights and so on. It is said that magnesium has the effect of killing bacteria by generating electricity of 0.5V when putting it into the bathtub, and has the same effect of the cleaning substrates. Since magnesium cleaning substrate consists of only magnesium, it causes no harm and no pollution by discharged water. This was reported by the media as the environment friendly cleaning substrate, and it maintains a high level of sales.

The boxing head gear is for protecting the head and is fitted at sparring or match of amateurs. This gear needs light weight, and high strength to protect the head.

The emergency lights in which magnesium batteries are combined with long-lived LEDs may have many uses.

Domestic Magnesium Market - November2015
(Source: November issue of Import/Export Statistics (customs clearance basis) of METI - Compiled by The Japan Magnesium Association)

Based on Import/Export Statistics of November 2015, magnesium metal import was 2,781.3 tons (4.8% decreased from the same month the year before), magnesium powder 325.5 tons (10.9% increased), and other products 199.1 tons (3.9% increased). For consecutive 4 months metal category decreased, and powder and others increased on a year-to-year basis.

The metal category consisted of 2,245.5 tons of pure magnesium (7.4% decreased), high purity magnesium 6.0 tons (12,400.0% increased), 523.0 tons of die-casting alloys (6.5% increased). As for the die-casting alloy, all the import was from Chine. Magnesium alloys for casting was 6.8 tons (9.1% increased).

As for the average import price of magnesium metal, the average price of pure magnesium in November is 249.4 yen per kg, decreased by 1.4 yen per kg (0.5% decreased) compared with October's price. On the contrary, the average price of magnesium alloy increased to 310.5 yen per kg (by 9.0 yen per kg, 3.0% increased.) As for the total amount of import from January to November 2015, magnesium metal was 29,294.4 tons (0.3% decreased, from the same period the year before), magnesium powder was 3,863.9 tons (2.6% increased), and the other was 2,150.3 tons (1.4% increased). Even showing the negative in metal category, the total amount continued at the same level, it was 35,308.5 tons (0.1% increased).

In November 2015, export of pure magnesium was still zero, and export of magnesium alloy was 38.4tons (71.2% decreased on a year-to-year basis). All the export was for U.S.A.

Powder and granular was 3.52 tons (848.4% increased) for Philippine, Thailand, and U.S.A. The other was 4.6 tons (108.4% increased). The amount of the others for Chine was 1.1 tons.

As for the total amount of export from January to November 2015, total amount of pure magnesium kept the same volume 13 kg (79.0% decreased), magnesium alloy was 1,077.4 tons (90.1% increased), powder was 8.4 tons (1.1% decreased), and the other was 29.2 tons (65.0% decreased).

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December China Magnesium Industry and Market Bulletin

Review of magnesium market in 2015 and forecast

1 Market price review and forecast

1.1 Review of the domestic price trend
In 2015 domestic magnesium price continue to fall sharply, the average price ended at 12970 yuan/ ton, down 11.69%, a record low for many years, while daily average price fluctuated in the range of 11450-13650 yuan/ton, with the highest of 13650 yuan /ton at the beginning of the year, and the lowest price of 11450 yuan / ton by the end of 2015.

In 2015 domestic magnesium prices stepped down, and industry manufacturers spontaneously organized to maintain price stability, which made magnesium price meet phase stability but then fell again in depressed demand. By the end of 2015, daily average closed at 11450 yuan / ton, transiently over 11000 yuan /ton.

In 2015 magnesium price, which fell significantly, was mainly triggered by the economic environment and loan factors, including:

First, the domestic and foreign market demand reduced. In international market, demand shrank as seen from China's exports of magnesium products, compared with the previous year. At the same time, owing to domestic economic slowdown, domestic demand declined both from upstream and downstream industries, while aluminum and other related industries encountered huge pressures, and part of them were forced to reduce production, which resulted in the cut down of magnesium demand.

Second, industry manufacturers failed to implement effective production limit. In the second half of 2015, the nonferrous metals industry faced unprecedented difficulties, as seen in copper, aluminum and nickel segments. A number of metal industries and enterprises spontaneously made joint effects to restrict output. However, magnesium industry, owing to large manufacture number and wide distribution, especially lots of private enterprises, was difficult to effectively implement a joint production. Under the pressure of loan, enterprises had to repeatedly cut their own ex-factory offer, which caused market prices to fall sharply.

As of the end of 2015, magnesium offer by manufacturers in main producing area ended at 11300-11400 yuan / ton in Shaanxi, 11500-11600 yuan / ton in Shanxi, and 11400-11500 yuan / ton in Ningxia.

As for export trend, export price went line in line with domestic magnesium price. In 2015 FOB prices fell sharply unilaterally. Annual average price fluctuated in the range of 1890-2405 U.S. dollars / ton, with the highest point of 2405 U.S. dollars / ton at the beginning of the year, and the lowest point of $1890 / ton by the end of 2015. FOB price declined, which mainly caused by the shrinkage of demand from both domestic and international market.

As of the end of 2015, FOB quoted by part of domestic manufacturers and traders closed in 1870-1910 U.S. dollars / ton.

1.2 The review of international magnesium market price
In 2015, the global economy appeared to differentiate, the U.S. economy gradually recovered, while European economy showed a slow growth trend, and the economic growth in emerging economies slowed. In terms of price, both the United States and the European market prices showed down trend.

1.2.1 American market
In 2015 U.S. magnesium price generally fell down. According to a report published in MW, magnesium ingot spot price, as of the end of December 2015, was $2.10-2.20/ pound, run flat with year 2014; trader import price $1.68-1.72 / pound, down $1.83-1.88 as compared with year 2014; and die casting alloy (trade) price $1.80-1.98/pound, basically kept flat as compared with $1.85-1.98 / pound in 2014.

1.2.2 Europe market
Impacted by the price plunge in China, European market prices also showed a sharp decline in the trend.
Metal Bulletin (MB) magnesium ingot price moved from $2900-3100/ton in 2014 to $1965-2035/ton in 2015, and European free market price published in MW was $2400-2500/ ton in 2014 but down to $1900-2000/t in 2015, while Rotterdam warehouse price came to $2550/ ton in 2014 but hit down to $1988 /t in 2015.

1.3 Magnesium market forecast in 2016
1.3.1 Analysis of the economic situation at home and abroad in 2016
In 2015 the main feature of the global economy was differentiated; in 2016, the global economy is expected to still be in a slow recovery phase, but the pace of economic recovery in various countries will be different.

Analysis of the international economic situation
In 2015, U.S. economy maintained steady recovery driven by job market, real estate market and other economic data. Majority of Americans look economic development with bright view and optimism. At the same time, U.S. economy in 2015 also meets uncertain factors such growing interest rates and financing costs. However, in 2016, U.S. economy , in general, will be a strong recovery, and U.S. economy will grow by 2.4%, higher than the 2.1% in 2015 as predicted by Federal Reserve.

In 2015, easy monetary policy implemented in euro zone added certain driving force for economic development, and the euro zone is expected to maintain growth momentum in 2016. However, market decline in demand in emerging markets and unstable factors in France and other major economies will drag down, to some extent, the pace of economic recovery in euro zone.

Analysis of the domestic economic situation
In 2015, China's economic adjustment entered the critical stage, but also a year of difficult period comprehensively. In 2016 China's economy will shift from the rapid development to moderate speed development, and economic growth will slow down. The People's Bank of China said that economic growth next year will remain basically stable within a reasonable range, and the economic structure will be further improved. Based on the latest benchmark macroeconomic model forecasts, in keeping with the intensity of fiscal policy and prudent monetary policy, actual GDP growth in 2016 is expected to be 6.8%.

Year 2016 is the beginning of China's 13th five year plan. by end of 2015, the central economic work conference was held to discuss the economic situation in 2015, the focus of steady growth, structural reforms tactical mission, and important areas of reform. The economic work conference ensures China's economic development through the shift period in 2016.

1.3.2 Magnesium market forecast in 2016
As for external environment, global economy recovery has limited effect on magnesium market, while domestic economic slowdown in growth rate may, to some extent, impact magnesium demand growth, especially magnesium-related downstream industries will be more urgent to cut down production in 2016, which will lead to the shrinkage of growth rate for magnesium demand.

In 2015, domestic magnesium companies cut overall output in an ineffective way which led to a sharp drop in the price of magnesium. In 2016, under financial pressure, industry enterprises are expected to work together and take collaborative measures to reduce production.

As for magnesium application, some mature breakthrough has been made in automobile, military and aerospace, and some of magnesium wheel products come through test and approval from United States and other developed countries. It only needs time for magnesium to find wide and rapid use.

In 2015, magnesium prices fell a record low, and, in 2016, the price of magnesium is likely to continue to decline, but the decline is limited. From comprehensive consideration of various factors, we expect China magnesium market price, in general, will maintain narrow fluctuation in 2016, and primary magnesium will run in 12950 yuan / ton at average, with FOB Tianjin Port average price at $2100 / ton (based on constant exchange reate).

2 global supply and demand analysis

2.1 global supply analysis and forecast
After several rounds of shuffling, the production of primary magnesium has dropped to historic low. Existing enterprises of primary magnesium are more stable in output. In a certain period, current pattern of supply will be maintained and is difficult to have a big growth.

We expect global primary magnesium production was 972kt in 2015, of which 820kt was contributed by China, 45kt by United States, 30kt by Russia, 30kt by Israel, 21kt by Kazakhstan, 16kt by Brazil, and 10kt by South Korea. After many years of re-structuring, output by countries exclusive of China has dropped to 152kt, only accounting for 15.64% of global production.

2.2 Consumption
From the perspective of regional development, with the rapid development of China, Asia will be the world's most important region for magnesium consumption, while European region will show a rapid growth trend.

From the perspective of the development of the industry, engineering materials will be the main growth point of magnesium consumption, especially in automotive sector. The CAFE in North America and carbon emission regulation in euro area propose very high requirements for automobile industry, and magnesium, as lightweight material, will be an important choice and inevitable trend for automobile.

In recent years, magnesium alloy die castings meet the fastest growth from world's major automobile manufacturers, as seen in Meridian, a subsidiary of Wanfeng Auto Holding. Magnesium alloy products by Meridian have found wide application in medium- and high-end automobile models.

Sluggish global economy restricts magnesium consumption growth temporarily, but the application of magnesium is still wide. With world economy running stabilization and recovery, magnesium industry will usher in a new round of development, and primary magnesium consumption will grow rapidly.

We expect that global magnesium consumption, in the coming two years, will resume growth momentum, and consumption in 2016 will hit one million tons.

3 Domestic supply and demand analysis

3.1 Domestic supply drop y-on-y
Based on statistics from China Nonferrous Metals Industry Association, we expect primary magnesium production in 2015 closed at 820kt, 6% down as compared with last year.

From the point of geography view, Shaanxi, Shanxi and Ningxia will totally account for over 86% of national total.

3.2 Export decline y-on-y
According to statistics from General Administration of Customs of PRC, we expect China's exports of magnesium products in 2015 ended at 400kt, down 8.05%, which mainly resulted from the reduction in overseas market demand.

3.3 Domestic consumption
3.3.1 Consumption in 2015
Product output in downstream industries reduced
Based on comprehensive data, we expect output of primary aluminum in 2015 came to 31500kt, up 10% y-on-y, and sponge titanium to 46kt, down 17.8%.

3.3.2 Application by processing industries maintained a rapid growth
In 2015, domestic magnesium consumption is expected to reach 380kt, a new record high. Due to generally poor downstream industry market, related growth rate slowed down. In processing segment, magnesium-using products are mainly export-oriented, and this segment will continue to maintain rapid growth, which will bring about growth rate at over 10% for magnesium consumption. This is observed by magnesium industry participants and is also the trend of the future development of magnesium applications.

3.4 Analysis on apparent consumption of magnesium in China
According to statistics from China Nonferrous Metals Industry Association, we expect China's production of primary magnesium in 2015 was 820kt, down 6.17% y-on-y. based on statistics from General Administration of Customs of PRC, we expect China's exports of all kinds of magnesium products in 2015 totaled 400kt, down 8.05%. As for China's magnesium consumption, we expect it ended at 380kt in 2015, up 2.51%, while domestic consumption accounts for 46.29% of the total supply, and exports for 48.73%.

For year 2016 we expect China's primary magnesium production will restore the growth momentum, and, with the development of magnesium processing, export volume will increase year by year.

(Contributed by Shixiaomei from CMA)

Top ten events for China's magnesium industry in 2015

  1. Differential-pressure casting process for magnesium alloy and aviation-oriented casting, an independent innovation casting technology carried out by Shanxi Wenxi
    Yinguang Magnesium, come through appraisal by experts from Northeastern University, Shenyang Aircraft Research Institute, Shenyang Aircraft Corporation and representatives from navy and air forces. Differential pressure casting process for magnesium alloy by Yinguang Magnesium Group is recognized by aerospace industry, which lays the foundation for the application of magnesium casting in other segments.

  2. New version national standard on casting magnesium alloy ingot came through approval
    Through two years of work, new version national standard on casting magnesium alloy ingot came through approval. It was organized by National Nonferrous Metal Standardization Technical Committee, and drafted by Shanghai Jiaotong University, National Engineering Research Center for Magnesium Alloys, Technical and Economic Research Institute for Non-Ferrous Metals, Henan Yuhang Metal Material, and Shandong Yinguang Yuyuan Light Metal Precision Molding. The new standard GB/T19078, upon its approval in Mar.2015, will be effective in 2016.

  3. New version foreign investment industry guidance: to encourage foreign investment in magnesium alloys and their applications
    Approved by the State Council, both National Development and Reform Commission and Ministry of Commerce announced the full text of the catalogue of foreign investment industry guidance (2015 Revision), effective as of April 10, 2015.
    Magnesium alloy castings and magnesium alloy with their application are selected in the guidance.

  4. 11 greenhouse gas management national standards issued, including magnesium smelting
    Standardization Administration of PRC announced industrial greenhouse gas emissions accounting and rules, and 11 greenhouse gas management national standards issued, including magnesium smelting, which will be effective as of June 1,2016.
    The standard sets reference for magnesium industry, which will benefit environmental protection.

  5. Mr.Shi Changxu, father of materials science in China, was named the person of year 2014 in China.
    Mr.Shi Changxu is a famous materials scientist, strategic scientist, member of Chinese Academy of Sciences, and member of Chinese Academy of engineering. He won national top science and technology award in 2010. On November 10, 2014, Mr.Shi Changxu passed away at the age of 96.

  6. Vancouver saw IMA's 72nd Annual World Magnesium Conference
    May 17-19, IMA's 72th Annual World Magnesium Conference was held in Vancouver, Canada. More than 230 representatives from 22 countries attended the conference, including more than 20 representatives from China. During the conference, were kicked off many events, besides special forums, chairman's reception, member conference, member exclusive reception, and awards presentation dinner party.

  7. CMA kicked off its annual conference in Beijing. It was sponsored by China Magnesium Association(CMA), China Nonferrous Metals Industry Association.
    The conference was attended by over 300 representatives from over 100 companies and institutes. It also initiated two seminars, one for new technology and new equipment, and other for magnesium alloy processing and application.

  8. South China's Rare Earth-magnesium Alloy Application Base was unveiled
    On November 2, unveiling ceremony was held for Jiarui Group's the 35th anniversary and South China's Rare Earth-magnesium Alloy Application Base in Jiarui Science and Technology Park (Huizhou).

  9. President Xijinping visited Xiaomi's booth exhibiting magnesium-made No.9 robot
    Dec. 16-18 saw No.2 World Internet Conference was held in Wuzhen, Zhejiang. President Xijinping presented in the conference and expressed his attention to Xiaomi's exhibition booth. He also personally gets on the robot.

  10. Magnesium price fell a record low
    In 2015, domestic and foreign markets continued to slump, and magnesium price fell a record low. Being difficult prevailed in magnesium industry. To look ahead in 2016, difficulties may be still there, the industry needs to work together to tide over the difficulties.
Source: China Magnesium Association

Magnesium alloy product surface treatment project with 10 million pieces of capacity settled in Hebi Development Zone
January 14th, Hebi Management Committee for Economic and Technological Development Zone signed with Shandong Yuanyang Group to construct Magnesium alloy product surface treatment project with 10 million pieces of capacity settled in Hebi Development Zone. Yu Yan, vice mayor of Hebi city, attended the signing ceremony.

The project, attracting 0.5 bln. yuan of investment, introduced magnesium alloy products surface treatment process from South Korea.

The process, which can make the surface of metal material more beautiful, corrosion resistance, abrasion resistance and anti-aging, has strong points by shorter processing time, low production cost and long product life.

The project, located in Hebi National Economic and Technological Development Zone, Jinshan Industrial Park, mainly serves, with its product, Samsung, Apple and LG.

It will be constructed by two phases. Phase I costs 0.15 bln. yuan, and phase II will be completed in 3 years. Headquartered in Hebi, the investor will set up factories in Chongqing, Dongguan, Kunshan, Shanxi, and Hebi.

The project is funded by both Shandong Yuanyang Group and Yaou Non-ferrous Metals Trading Center.

Yunhai Special Metals added capital to Eontec-Yunhai project
January 19, Yunhai Special Metals signed with Eontec an agreement, in which Yunhai Special Metals intends to adjust shareholder capital for Eontec-Yunhai project in Chaohu. Upon the adjustment, Yunhai Special Metals will take Eontech-Yunhai project share by 40% from former 20%.

February 6, 2015, Yunhai Special Metals signed a cooperation agreement with Eontec. Both parties jointly invested in Chaohu, Anhui, for the construction of light alloy precision die casting project. The project attracted 0.5 bln. yuan of investment, in which Eontec provided 0.4 bln. yuan and Yunhai Special Metals 0.1 bln. yuan. For the implementation of the project, the two companies set up Eontec-Yunhai in Chaohu. As of 10 mln. yuan of registered capital, Yunhai Special Metals funded 2 million yuan, accounting for 20% of registered capital, and Eontec invested 8 million yuan.

Then two sides signed supplementary agreement, in which Eontec-Yunhai will have 50 mln. yuan of registered capital from former 10 mln. yuan, 30 mln. of which will be from Eontec and 20 mln. from Yunhai Special Metals. But total investment of the project is still 0.5 bln. yuan, of which Yunhai Special Metals invested 0.2 bln. yuan, Eontec 0.3 bln. yuan, all through self financing by the parties.

According to estimates, the project, upon its completion, will realize 1 bln. yuan of income and 102.75 mln. yuan of net profit annually.

Inner Mongolia North Magnesium Technology put into production 300kt clean coal project
On January 28, Inner Mongolia North Magnesium Technology put into operation 300kt clean coal project. Manager from the company said "in the past two years, we operate magnesium products at a loss, and coke market is not good, although magnesium price has rebounded to over 12000 yuan/ton, we company is still losing money. To increase the company's efficiency, we add project of new briquette products, of course, we can't give up magnesium production." Inner Mongolia North Magnesium Technology, with 1000t/m of output of primary magnesium, is the only magnesium producer in Baotou.

Established on September 10, 2007, Inner Mongolia North Magnesium Technology, located in the North Magnesium Industrial Park, Shiguai District, Baotou, mainly engages in R & D and production magnesium, magnesium alloy smelting and downstream products.

Output of primary magnesium by December 2015
Output by geography (Unit: kt)

Jan. - Dec.
Jan. - Dec. % Change
Inner Mongolia

Exports of Magnesium Products closed in December (Unit: t)
Magnesium Unwrought
(min. 99.8%)
Other Magnesium and Alloy Unwrought
Waste and Scrap


Magnesium raspings/turnings/granules according to size & powders


Magnesium Wrought
Magnesium Articles
Monthly Total

Magnesium Ingot Price by Sunlight Metals (Unit: Yuan/t)
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