China has long been a major force in the global magnesia
market. The entry of low-priced magnesia exports from China
almost 30 years ago disrupted supply market dynamics. The
growth of the Chinese steel and refractory industry since 2005
has equally influenced the way magnesia demand worked.
The challenges and opportunities resulting from the latest
disruptions to magnesia supplies in China, and the changing
global dynamics of magnesia supply and demand, are numerous. In
the short term, the availability of dead-burned magnesia (DBM)
and fused magnesia (FM) will be a problem for refractory
producers that do not have their own magnesia resources.
But there is no lack of magnesite outside China, and in the
medium to longer term this presents opportunities for both
existing and aspiring magnesia producers.
Supply has been developing in a number of areas other than
China, and these are now gaining in prominence. Turkey, Russia
and Brazil have historically been important producers and
exporters, but others are also making progress and are seeking
to capitalise on the disruptions in China.
|View of Magnezitovaya
magnesite mine, Satka site.
Magnezit Group has total reserves of 260 million tonnes in
Russia, split between 150 million tonnes in the Chelyabinsk
region (Satka) and 110 million tonnes in Razdolinsk
In 2011, Magnezit Group obtained a license to develop the
Talsk deposit, while the nearby Kirgiteisk deposit near
Razdolinsk has been developed since 2006. Since early 2013,
magnesite has been produced in Razdolinsk on a commercial
scale and has become part of the production cycle at the
Lower Angara (Krasnoyarsk Territory) and Satka production
Over the period 2016-29, output from the Magnezitovaya
magnesite mine will grow to 1.6 million tonnes per year from
the Satka asset.
Magnezit’s output capacity for magnesia in 2017
was 700,000 tonnes (630,000 tonnes of DBM and 70,000 tonnes of
FM). This will increase by 2023 to 915,000 tpy (730,000 tpy of
DBM and 185,000 tpy of FM).
|View of Fused Magnesia Workshop Nº
5, Satka site, 50,000 tpa planned for 2019.
Turkey has the third-largest magnesia production capacity in
the world behind China and Russia, with 960,000 tpy. It has
the fifth-largest magnesite resources globally at 700 million
tonnes, behind China, North Korea, Russia and Brazil.
Resources in six regions in the country include Konya holding
30.6%, Kutahya 26.6%, Eskisehir 28.3% and others 14.5%, based
on cryptocrystalline magnesite. There are also sedimentary
magnesite deposits in Turkey which have not yet been
There are eight main companies in Turkey with
Kümaş accounting for 48% of total capacity, Magnesit
AS/RHI-Magnesita 27%, Turkmag 10% and others 15%. Capacity by
products is caustic calcined magnesia (CCM) 19%, DBM 77% and FM
4%.Kümaş Manyezit Şanayi controls 12 major
mining areas with 82 deposits. In 10 mining areas, 1,926
boreholes have been drilled and tested. Mineral resources
(measured and indicated) are 31.34 million tonnes and mineral
reserves (proved and probable) are 64.75 million tonnes,
totaling 96.09 million tonnes of resources and reserves of
There are plants at Kūtahya and Tavşanli:
- Three rotary kilns; total capacity for DBM, DBD and CCM
is 300,000 tpy
- Four electric-arc furnaces for production of FM; total
capacity 40,000 tpy
- One MHF kiln for production of CCM; capacity 60,000
- One rotary kiln and two shaft kilns with capacity for
- Produces DBD and DBM in new shaft kiln
Turkmag has capacity for 100,000 tpy and was commissioned in
December 2010. Magnesite reserves exceed 20 million tonnes.
Production in 2017 was 140,000 tonnes of magnesite ore and
50,000 tonnes of DBM.
Projected production for 2018 is 240,000 tonnes magnesite
ore and 90,000 tonnes of DBM. Investment is planned for a
second rotary kiln in 2019-20.
Akdeniz Mineral Kaynaklari (AMK) is a joint venture with
Grecian Magnesite. AMK has three main concessions totaling
4,238 hectares. Mining of cryptocrystalline magnesite is from
open pits near Eskişehir - one of which is Sazlik.
There are four pre-beneficiation facilities at Aktepe with
the main plant at Erenkoy. AMK’s production plant
and rotary kiln are at Kümbet, with two shaft kilns and
rotary kilns for CCM production. The capacity of the plant is
36,000 tpy but AMK plans to increase this by 30,000 tpy.
Demireller Mining has a mining license covering 1,853
hectares near Mut, in Mersin province. The deposit is
cryptocrystalline magnesite and proved reserves are 5 million
tonnes, with more resources to be evaluated.
The magnesite deposit shows a range of qualities with SiO2
(0.25-5.0%), CaO (0.3-1.2%), Fe2O3 (0.25-1.0%), MgO (43-47%)
and LOI (46-51%). The location is 160km from Mersin Port.
Halil Demirel is the president and chief executive officer
of the company, which has been producing raw magnesite since
2013 and supplying to DBM producers in Turkey. There are two
beneficiation plants at the mine, and Demireller has purchased
a rotary kiln (105m long, 3m wide) with capacity for 90,000 tpy
of DBM. The kiln is onsite now but has not yet been
IBAR-Nordeste has two operations in Brumado-BA and
Jucás-CE. In 2017, Brumado IBAR’s capacity
was 180,000 tpy (160,000 tonnes of CCM and 20,000 tonnes of
DBM), while Jucás had capacity for 30,000 tpy of CCM.
Reserves at Brumado are 100 million tonnes and at Jucás
3 million tonnes.
A significant expansion at Brumado will be a new rotary kiln
- the fourth one at the site. There will be a new MHF for
calcining in combination with a shaft kiln for sintering. A
flotation project for making high-purity MgO (minimum 96.5%)
will target both the CCM and DBM markets. Flotation trials have
already been commissioned and show positive results in terms of
achieving higher grades.
Magnesium do Brasil has mines and a plant at
Jucás-CE. There are two shaft kilns and current
production capacity for CCM is 75,000 tpy. Resources of
magnesite are 52 million tonnes. At present, there is a new
shaft kiln on site, yet to be installed, which will increase
capacity by about 30,000 tpy.
Kümaş’ new shaft kiln
at Tavşanli plant.
|Magnesite mine of AMK
Following many years of uncertainty, Finland’s
Afarak Group in May 2018, acquired Magnohrom, a refractory
company with magnesite mines and production facilities in
Following completion of a two-year sintered magnesite test
project (DBM and CCM) at the Magnohrom plant, Afarak acquired
the business for €1 million ($1.17 million) with confirmed
reserves of more than 4 million tonnes.
"Afarak will invest in upgrading the technology and equipment
at the mines and processing units," Afarak CEO Guy Konsbruck
said. The deposits are cryptocrysalline magnesite with veins
Pakistan has two types of magnesite, with macrocystalline
(sparry) associated with dolomite near Abbottabad in the
north, and cryptocrystalline magnesite in the south
associated with ultra-basic rocks (mainly serpentine). Both
types are suitable for DBM and CCM, with the
cryptocrystalline magnesite being a higher quality.
A sketch-map of some of the deposits of Pakistan is shown on
the following page.
At present, magnesite is mined in the Abbottabad area and in
the Muslim-Bagh, Nasai, Reskbrd and Baran Lak deposits. There
are small local kilns producing some DBM and CCM.
Recently, raw magnesite has been mined and exported in
containers. Master Minerals (a new company) has exported some
MB grade material from Muslim-Bagh, with trial shipments to
China and Greece. Another company is exporting raw magnesite
Grade WH to India.
Two magnesite deposits, Korab and Thessally, in Northern
Territory are being developed but as yet there has been no
Korab Resources is developing the magnesite deposit at
Winchester. Indicated and inferred resources are 16.6 million
tonnes at an MgO Grade of 42.3%, covering just 7% of the
mineralized trend, which continues for about 8km.
The mine can produce various grades of magnesium carbonate
rock (42-46% MgO). The primary aim is to export magnesite ore
to other countries, and it is believed that India will be a
target market because there is a shortage of high-quality
magnesite due to mine closures in Salem on environmental
Thessally Resources is the sole owner of the Huandot
magnesite deposit at Bachelor, 60km south of Darwin. Mineral
resources are 17 million tonnes at 43% MgO, and high-grade
magnesite resources are 9.1 million tonnes at 44.3% MgO and 4%
insolubles. The exploration target is 13-20 million tonnes at
This is the closest Australian deposit to the Asian markets.
It is next to road and rail links, and has electricity and gas
utilities, together with year-round access to mineral tenements
and a major port. The East Wharf near Darwin is a deep-water
port able to accept Panamax-size vessels.
Calix Ltd (Calix) owns and operates two mining tenements at
Myrtle Springs in South Australia. These tenements were
acquired for A$1.0 million ($742,000) in 2013. Magnesite is
processed at Calix’s CFC (Calix Flash Calciner)
plant at Bacchus Marsh in Victoria.
Calix launched an A$8 million initial public offering (IPO)
in June 2018 and part of these funds is intended to increase
production of high-reactivity CCM from the current 10% of the
rated capacity for 25,000 tpy of CFC.
Other recent development in Australia include:
- Archer Exploration announced in July 2018 the sale of its
Leigh Creek Magnesia Project, which includes two exploration
licenses in South Australia, to an unnamed private Australian
company. EcoMag issued a prospectus in June 2018 to raise A$3
million prior to listing in August 2018. The company is
looking to develop its new process to produce magnesium-based
materials including hydrated magnesium carbonate and CCM from
bitterns, a waste product from salt manufacture.
Other supply developments
MGX Minerals released an NI 43-101 PEA for its Driftwood
Creek magnetite project in British Columbia, Canada, in April
2018. It envisages production of as much as 170,000 tpy of CCM
and 95% MgO DBM. Measured and indicated resources were 7.8
million tonnes at a 42.5% MgO cutoff.
RHI Magnesita restarted production of FM at Porsgrunn in
Norway in January 2018, and is expected to increase production
to full capacity. It also announced that its dolomite mine in
Chizhou, in China’s Anhui province, will restart
at the end of 2019.
Prior to these developments, RHI Magnesita claimed 70%
vertical integration in magnesite and dolomite raw materials
and annual production of 760,000 tpy of standard DBM (90-97%
MgO), 280,000 tpy of high-purity DBM (+97% MgO), 110,000 tpy of
FM and 400,000 tpy of DBM.
K+S completed its acquisition of CCM and synthetic magnesium
sulphate producer Huludao Magpower Fertilizers (Magpower) in
China in January 2017. The current capacity of 90,000 tpy will
be doubled to 180,000 tpy.
MIMC’s magnesite manufacturing facility in
Saudi Arabia has capacity for 39,000 tpy of CCM and 32,000 tpy
of DBM. First sales of 2,000 tonnes of DBM (>94% MgO) were
made in 2017 and were expected to increase in 2018. Increased
sales of fertiliser-grade CCM are also expected.
Global production from magnesite mines in 2017 has been
estimated to be 27 million tonnes, of which 67% was produced in
In 2017, China exported about 884,000 tonnes of DBM, 654,000
tonnes of CCM and 428,000 tonnes of FM, a total increase in
magnesia exports of 34% compared with 2016. The increase was
largely a result of expected supply problems from China.
It has been estimated that the refractory market accounts
for about 75% of the global demand for magnesia, and that China
produces about 80% of global FM and about 44% of global
In June this year, IHS Markit estimated that the global
market for CCM, excluding production of DBM and EFM, was about
4.4 million tonnes in 2017. It divided applications into
construction (39%), agricultural (26%), magnesium chemicals
(15%), environmental (11%) and other (9%). It also estimated a
modest compound annual growth rate (CAGR) of 1.8% for
Also in June, Roskill estimated that China produced about 3
million tonnes of CCM in 2017 while the rest of the world
produced about 1.5 million tonnes.
China’s production of refractory materials
decreased by about 4% in 2017 to 22.9 million tonnes. And 2017
was the fourth consecutive year of declining refractory
production, despite increasing steel production over the same
period, due to increased efficiencies in steel production and a
declining steel specific consumption (kg of refractories per
tonne of steel produced).
Also over the same period, the percentage of monolithic
refractories consumed by all Chinese industries increased to
43% from 40%.
Refractory production in China is forecast to continue to
fall while steel production stabilizes or decreases, and the
use of recycled steel increases from its current low level of
6% of total production. In ten years’ time, annual
Chinese refractory consumption is expected to fall to 15-16
million tpy, with production about 17-18 million tpy.
Refractories production outside China is expected to
increase in the next decade to about 16 million tpy from its
current level of about 13 million tpy.
But combined with the declining production in China, it is
expected that annual world refractory production will
initially decline and then remain in the range of 33-34
million tpy until about 2030.
Industrial Minerals pricing data shows increases in Chinese
export prices for all grades but particularly DBM and FM,
starting around July 2017 and accelerating for most grades in
October 2017, or for higher purity DBM in March 2018.
By June 2018, there had been some price reductions from the
peak values except for the highest purity products, such as FM
(98% MgO) and DBM (94-95% and 97.5% MgO).
With modest growth expected in demand for CCM and little
growth foreseen in demand for DBM and FM, together with
significant resources outside China, the main issue is how
quickly production of DBM and FM can be increased outside China
to compensate for any decline in supply from China.
The current higher Chinese prices will obviously improve the
financial viability of such plant expansions and developments
It remains to be seen whether the planned consolidation of
Chinese magnesia producers will affect how widely this change
is felt, or whether the enormous reserves of magnesite in
other places such as North Korea will be the basis for the
next - and fourth - disruption to the global magnesia
Dr Richard Flook has worked with companies including
Steetley plc, Anglo American, Commercial Minerals (now
Sibelco), Normandy Mining Ltd, Omya AG and Shinagawa
Refractories. He is the Managing Director of Mosman
Dr Ian Wilson has worked with IGS (now British Geological
Survey), English China Clays and IMERYS. He was General
Manager of ECC do Brasil and Joint Managing Director of
CEDESCA in Spain.