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Magnesia Global Market

The Chinese magnesia market is on the cusp of maturity as government policies shape the future of the industry. Chinese magnesite and magnesia producers – by far the largest in the world – are under government orders to phase out old and inefficient production technologies, undertake mergers and acquisitions, and improve resource management. These changes are occurring against a backdrop of renewed magnesia investment in the rest of the world. New projects and capacity expansions in countries such as Brazil (Magnesita Refratários), Norway (RHI AG), Russia (Magnezit Group) and Turkey (RHI, Kümaş and others) have been encouraged by tightening export supplies and higher prices from China, which also leads world magnesia trade. Companies in the rest of the world have outlined plans to develop 1,8 Mt/a of additional magnesia capacity between 2011 and 2015. As much as 500000 t/a of this has already come online. Consumption of caustic calcined magnesia (CCM) is mainly driven by the industrial sector in its role in water, waste and flue gas treatment chemicals. High-value speciality CCM is expected to benefit from its use in hydrometallurgy, a metal extraction method that is gaining popularity in nickel/cobalt operations. Consumption of dead burned (DBM) and fused magnesia (FM), which constitutes more than 70 % of the total magnesia market, is almost exclusively in the production of refractories. Their consumption is dominated by iron and crude steel (73 %) and cement and lime (13 %). Roskill forecasts world crude steel output will grow by 3,5 %/a between 2012 and 2020, consequently driving demand for refractories and refractory magnesia. Integrated refractories producers are responsible for many of the magnesia capacity expansions that are underway or completed. A key concern for these producers is stability of supply to meet forecast demand; for many consumers, this means independence from Chinese magnesia exports. Roskill forecasts the total magnesia market will grow by 3,2 %/a to 2018; the highest growth is expected to be in the CCM sector at 3,6 %/a while the lowest is forecast to be FM at 2,6 %/a. Refractories will continue to be the single largest consumer of magnesia. As additional magnesia capacity is installed in the rest of the world, export dependence on China is expected to decrease. Chinese magnesia is subject to various export controls including a restrictive quota; thus changes in Chinese policy may affect magnesia supply and prices, independent of market conditions. (Source: Roskill Information Services Ltd. (9/2013)


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