Unprecedented situation: Associations call for EU engagement in Chinese magnesium shortage

A number of European industry associations, including vehicle manufacturers’ association the ACEA and wheel manufacturers’ association EUWA, have issued an “urgent call for action against the imminent risk of Europe-wide production shutdowns as a consequence of a critical shortage in the supply of magnesium from China.”

Magnesium is a key alloying material and widely used in the metals producing industry. The associations European Aluminium, Eurofer, ACEA, Eurometaux, industriAll Europe, ECCA, ESTAL, IMA, EUWA, EuroAlliages, CLEPA and Metals Packaging Europe believe that “without urgent action by the European Union,” this issue, if unresolved, threatens thousands of businesses across Europe, their entire supply chains and the millions of jobs that rely on them.

The issue at hand, explain the associations, stems from the Chinese Government’s effort to curb domestic power consumption. This has resulted in a complete halt or drastic reduction of magnesium originating from China since September 2021, resulting in an international supply crisis of unprecedented magnitude. The European Union is dependent on China for 95 per cent of its magnesium supply needs, and therefore its aluminium, iron and steel producing and using industries together with their raw materials suppliers are particularly impacted by recent developments. Prices for magnesium have increased as much as sevenfold this year, they add.

“Europe is expected to run out of magnesium stocks by the end of November, with production shortages, business closures and associated job losses to follow,” stress the associations. “To that effect, our industries jointly call on the EU Commission and national governments to urgently work towards immediate actions with their Chinese counterparties to mitigate the short-term, critical shortage issue as well as the longer-term supply effects on European industries.”

The cross-industry statement can be read here.