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China’s magnesia prices firm on strict environmental inspections

Magnesia production hubs in China are continuing their efforts to reduce negative environmental impact, while domestic magnesia prices firm and export prices hold steady on low demand.

Following China’s closure of companies in the Dashiqiao magnesia production hub that failed to meet environmental standards and the Haicheng government’s progress in consolidating the magnesia industry in early September, the Dashiqiao and Haicheng governments have been stepping up efforts to improve local air conditions to make them comply with Beijing’s environmental targets.

Officials from the Dashiqiao and Yingkou governments held a conference with local refractory companies on September 14 to establish improved emission standards for air pollutants in the magnesia-based refractory industry. Local companies should strictly follow the production standards.

Meanwhile, the Haicheng government has started a new round of environmental inspections in the local area, which will last one month from September 18 to October 19.

During this round of inspections, some magnesia companies in Haicheng and Dashiqiao have chosen to stop production and upgrade equipment to meet the new standards for inspection, leading to reduced supply in the spot market. With mining restrictions still in place, domestic Chinese magnesia prices have firmed again, and some producers have even started to increase prices for magnesia, especially fused magnesia (FM) and dead-burned magnesia (DBM), though this has not affected market prices yet.

“China’s magnesia prices will not fall further, or even increase in a small range, due to the recent conference and new round of environmental inspections. Dead burned magnesia prices will be influenced more as more producers might stop production due to the inspections in Haicheng. Meanwhile export prices are temporarily standing still as demand from buyers remains quiet,” an exporter in Dalian told Industrial Minerals.

Industrial Minerals’ latest price assessments showed the fob China price of magnesia, fused, 97% MgO (Ca:Si 2:1) was at $1,250-1,350 per tonne on September 18, flat with previous week. Industrial Minerals’ assessment for the fob China price of DBM, 90% MgO lumpwas at $220-260 per tonne on September 18, also unchanged from the previous week.

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