Aluminium scarce related to magnesium supply deficiency from China, says AMAG chief

The raw material required for the production of metal aluminium is experiencing a dearth, while the price of the green metal has towered to sevenfold in a short span and the consumers will get the heat sooner or later, as stated by Adolf Kerbl, the Managing Director of the Foundry Industry Association.

Gerald Mayer, the CEO of AMAG Austria Metall AG commented by saying: “The reason for the aluminium deficiency is actually a magnesium deficiency that resulted from the throttling of Chinese electricity production at coal-fired power plants.”

“China has cut electricity production for environmental reasons in order to meet the climate targets. As a result, magnesium factories would produce less or would come to a standstill. The world market is dependent on China and around 87% of world production of magnesium takes place in China”, said Mayer.

AMAG Austria is a supplier of primary aluminium and premium cast and rolled aluminium products. At the integrated facility in Ranshofen, Austria the company fully leverage its core competencies in recycling, casting, rolling, heat-treatment, and surface finishing.

The Association of Mining, Steel and Non-Ferrous Metal Industry in the Austrian Chamber of Commerce are also alarmed about the crisis of magnesium, as it is used as an alloy metal. Magnesium is an irreplaceable component for aluminium and steel production and is of fundamental importance in the automotive industry, in packaging and for buildings.

In September 2021, a huge amount of magnesium production in China has been ceased due to the energy fall-out.

Dr Roman Stiftner, the Managing Director of Austrian Chamber of Commerce, Mines and Steel, trade association while speaking on the worldwide crisis of magnesium said: “China is a de facto monopoly, because 95% of the amount used in the European Union, the magnesium comes from China.”

Stiftner presumes that the supply of magnesium will be used up by the end of November and due to the vital factor of magnesium in the value creation process, this production diminution threatens the existence of thousands of companies in Europe and the jobs associated with them.

It’s high time for the European Union and its member states to initiate discussions with the Chinese authorities to concur on short and medium-term solutions.