EU leaders voice concerns over impact of China's magnesium crunch in production activities

In a key development, European leaders have raised concerns about the impact of a shortage of Chinese magnesium on the European industries. The fear among the European Union bloc leaders have grown as magnesium is vital for various sectors including the automobile sector and electronics, according to ANI. The leaders of European Union nations are alarmed as China has reduced the magnesium supply amid nationwide energy shortages.

Impact of magnesium shortage in Europe

The European market is 95% dependent on China for the supply of magnesium and amid the shortage of magnesium, the European countries have started voicing concern. As China, one of the world's biggest magnesium producers has been facing shortage issues, it would be difficult for small-scale magnesium producers like Russia and Israel to meet the demands, ANI cited Politico report. The magnesium shortage in China might impact the production activities of various sectors like the automobile industry, electronics and aviation.

German Chancellor Angela Merkel and Czech Prime Minister Andrej Babis had raised the issue of magnesium shortage during a European Union leaders summit. A diplomat familiar with the discussion that happened in the European Union leaders summit has revealed to Politico that Merkel "warned" her fellow leaders that it would be too expensive to produce magnesium in China owing to the high energy price. 

"Merkel said it's become too costly to produce it (in China) because of the high energy prices," ANI cited Politico report for quoting the diplomat.

Merkel highlighted that the shortage of magnesium could impact car production in Europe. During the European Union leaders summit, Czech Prime Minister Andrej Babis also raised concern over the shortage of magnesium. The diplomat further informed that Babis in the EU summit said, "After the semiconductors crisis, now we have magnesium crisis," ANI cited Politico report for quoting the diplomat. European Union officials have stated that they have been engaging with Chinese officials over the issue, reported Politico.

Chinese magnesium producers in Yulin, China's Shaanxi Province, that have been supplying over 50% of magnesium for consumption across the world, are facing soaring prices. Some of the businesses have started their operations again in the recent weeks, however, restrictions have reduced the output, reported Global Times. The reduction in the production of magnesium might lead to a 10% decrease in exports, which might impact the industries across the world amid shortages in Europe, Global Times reported citing industry insiders. The production in China was disrupted in mid-September which included magnesium plants. 

Inputs from ANI

Image: AP