China's magnesia price soared up on higher coal costs, power cuts widen and tight environmental controls
The local government of Anshan, Liaoning province, China has pushed further integration of magnesite mining rights and was expected to reduce mining rights from 63 to 37.
The Liaoning provincial leadership team visited the major magnesite and magnesia enterprises in Liaoning province to check the operating and current situation about the development of industrial control platform, green mining and suspension furnace projects, etc.
China's magnesia price soared up on higher coal costs, power cuts widen and tight environmental controls
In order to implement the government plan for the consolidation of the steel industry and deal with climate push, there are more than 60 shaft furnaces will be shut down in China.
By following the implementation of "Opinions on Promoting the Sustainable and Healthy Development of Magnesite Industry" and "Notice on Several Matters Concerning the Integration of Magnesite Resources and Mining Rights in the Province", we can see the Integration has been pushed forward.
For the consolidation of the magnesite industry in Haicheng and Xiuyan (Anshan city, Liaoning province, China), based on the priority rules of ecosystem, government-led, enterprise voluntary, mining rights reduction and strict supervision, there were expected to reduce mining rights from 63 to 37, which plan to eliminate 17 awards of magnesite mining rights in Haicheng and eliminate 9 awards of magnesite mining rights in Xiuyan.
In terms of the integration of mining enterprises, it has been preliminarily determined that the Haicheng Magnesite Group Co., Ltd. and Liaoning Magnesite Mining Co., Ltd. will be the main undertake unit to complete the integration.
Meanwhile, for green mining, there are 28 magnesite mining areas have been listed in the green mining database, and 3 of them also approved the green mining project. Regarding the supply of raw materials, the 80% limitation of mining has been implemented, the annual mining volume has been limited to 9.6 million tons.
The Liaoning provincial leadership team visited the major magnesite and magnesia enterprises to check the operating and current situation about the development of industrial control platform, green mining and suspension furnace projects, etc.
Mr Miao Zhimin, Director of the Provincial Department of Industry and Information Technology, said "we have to maintain and continue the job in pollution control", and agreed in the improvement of the reform of magnesite industry in Haicheng, Liaoning.
A comprehensive inspection has been visited and investigated 215 magnesite enterprises in Liaoning province based on the latest environmental emission standards 2021. There are 95 magnesite processing enterprises and 1141 kilns that were shut down to reform, and 77 enterprises have completed desulfurization and denitrification transformations.
Magnesia Pricing in Liaoning, China
The price of magnesia was not affected by the increasing price of raw materials and downstream products but has been boosted up by the higher production costs and power cuts widen in Liaoning province, plus a more strict regime of environmental regulations.
Repeated rises in the cost of coal and widening power curbs that have disrupted magnesia processing operations, Chinese magnesia producers and manufacturers may finally be getting some relief because of the price soaring up. The rising prices show on China-origin caustic calcined magnesia, dead burned magnesia and high-purity magnesia. According to the data from the Northeast Asia Magnesia Exchange, the ex-factory price of DBM, MgO≥92% Lump, is RMB 1500-1600 yuan/ton; DBM, MgO≥95% (0-40mm) is RMB 2700 yuan/ton; DBM, MgO≥95.6% is RMB 3000 yuan/ton (see Table1).
Table1: Magnesia pricing updated on 27/09/2021
Data source: the Northeast Asia Magnesia Exchange
Provincial authorities have stepped up enforcement of emissions curbs after only 10 of 30 mainland regions managed to achieve their energy goals in the first half of the year, while nine provinces and regions increased their energy consumption on an annual basis.
Recently, according to the announcement of the National Electricity and Production Limitation from the National Grid Corporation of China, many provincial governments issued the Dual Control System of Total Energy Consumption and Energy to control the high energy consumption and high pollution. On 23rd Sep 2021, Liaoning Provincial government issued a notice, imposing continued restrictions on industrial electricity use in the province, which also restricted the power supply for magnesia enterprises in Haicheng and Dashiqiao.
Moreover, the environmental inspections come to Liaoning province at the same time, which means almost all magnesia producers impact on different levels without exception. Especially for small businesses, there are nearly 40% of small companies forced to stop work due to the increasing production costs.
The National Electricity and Production Limitation is not only for Liaoning province, but also for other provinces, such as Yunnan, Jiangsu, Qinghai, Ningxia, Guangxi, Guangdong, Sichuan, Henan, Chongqing, Inner Mongolia, and Henan, etc.
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