Halt in magnesium supply from China

Subject: Halt in magnesium supply from China

The German automotive and steel industries are dependent on magnesium from China. The export ban on magnesium which has now been imposed by the Chinese government is threatening the German manufacturing industry.

1. Does the Commission appreciate the threat posed by this halt in supply to the German aluminium industry and its raw material-dependent producers?

2. What will the Commission do to make the Union economy more resilient and independent of global supply chains?

3. How will the Commission support this sector in order to minimise, for example, car and aircraft production problems and ensure that countless jobs are not put at risk?

Answer given by Mr Breton on behalf of the European Commission

(27 January 2022)

The Commission fully appreciates the threat posed by supply disruptions and importance of magnesium to a number of key European value chains such as aluminium and steel as well as their downstream customers.

In October 2021 the Chinese Ministry of Industry and Information Technology reassured that the production has restarted and was expected to reach in the fourth quarter of 2021 85% of 2020 production level.

The European industry signalled that companies were able to secure enough supply of magnesium until March 2022, though at a very high price. The uncertainty regarding the supply security after March 2022 still remains.

The EU identifies and monitors raw materials of high importance to the EU economy and of high risk associated through the development of the EU’s Critical Raw Materials list (1), which includes magnesium.

This is strongly emphasised in the EU’s industrial policy (2). Some of the recent key actions (3) include the launch of the European Raw Materials Alliance (4) and the development of strategic international partnerships (5) to secure a diversified supply of sustainable critical raw materials.

The lack of diversification of sources of supply at a global scale limit the availability of short-term actions to compensate for reduced volumes of magnesium produced in China.

To improve the security and sustainability of magnesium supply in the medium to long term, the Commission is discussing with EU industry and Member States the feasibility for production of magnesium in Europe and will keep exploring possibilities to diversify EU’s sources of supply by reaching out to its trade partners.

⋅1∙ https://ec.europa.eu/growth/sectors/raw-materials/areas-specific-interest/critical-raw-materials_en

⋅2∙ https://ec.europa.eu/info/strategy/priorities-2019-2024/europe-fit-digital-age/european-industrial-strategy_en#relatedlinks

⋅3∙ https://ec.europa.eu/docsroom/documents/42852

⋅4∙ https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:52020DC0474&from=EN

⋅5∙ With Canada and Ukraine,

https://ec.europa.eu/commission/commissioners/2019-2024/breton/announcements/joint-statement-european-commissioner-internal-market-and-canadas- minister-natural-resources_en

https://ec.europa.eu/commission/presscorner/detail/en/IP_21_3633