MAGNESIUM COMPOUNDS1/ (Data in thousand metric tons of magnesium content, unless noted) Domestic Production and Use: Seawater and natural brines accounted for about 72% of U.S. magnesium compounds production. Magnesium oxide and other compounds were recovered from seawater by four companies in California, Delaware, Florida, and Texas; from well brines by three companies in Michigan; and from lake brines by two companies in Utah. Magnesite was mined by one company in Nevada, and olivine was mined by two companies in North Carolina and Washington. About 67% of the magnesium compounds consumed in the United States was used for refractories. The remainder was consumed in agricultural, chemical, construction, environmental, and industrial applications. Salient Statistics--United States: 1991 1992 1993 1994 1995e/ Production 442 418 386 345 300 Imports for consumption 156 179 256 287 350 Exports 57 49 52 46 50 Consumption, apparent 541 548 590 586 600 Stocks, producer, yearend NA NA NA NA NA Employment, plante/ 650 650 650 600 600 Net import reliance2/ as a percent of apparent consumption 18 24 35 41 50 Recycling: Some magnesia-base refractories are recycled, either for reuse as refractory material or for use as construction aggregate. Import Sources (1991-94): China, 62%; Canada, 13%; Mexico, 5%; Greece, 5%; and other, 15%. Tariff:3/ Item Number Most favored nation (MFN) Canada Non-MFN4/ 12/31/95 12/31/95 12/31/95 Crude magnesite 2519.10.0000 Free Free $10.33/t. Dead-burned and fused magnesia 2519.90.1000 0.3›/kg. Free 1.7›/kg. Caustic-calcined magnesia 2519.90.2000 $1.66/t Free $20.70/t. Depletion Allowance: Brucite, 10% (Domestic and Foreign); dolomite and magnesium carbonate, 14% (Domestic and Foreign); magnesium chloride, 5% (Domestic and Foreign); and olivine, 22% (Domestic) and 14% (Foreign). Government Stockpile: None. Prepared by Deborah A. Kramer, (703) 648-7719. MAGNESIUM COMPOUNDS Events, Trends, and Issues: Magnesia imports, primarily from China, continued to affect the U.S. magnesium compounds industry. In addition to these imports supplying a greater share of demand, higher prices for Chinese magnesia led to increased refractory magnesia prices. Export licenses for Chinese magnesite that were instituted in 1994 and continued throughout 1995 had the effect of increasing prices for exported material. As a result, U.S. firms that were using Chinese magnesite as a raw material source passed the price increases to their customers. At the same time, the largest magnesite producer in China announced that it was curtailing production, particularly on lower grade products, and was concentrating on high-grade magnesia. One of the two U.S. magnesium chloride producers in Utah, with operations in Ogden, announced that is was purchasing the other producer, which has facilities in Wendover. The Ogden firm also announced that it had completed an expansion of its facilities, nearly tripling its annual magnesium chloride hexahydrate production capacity from 11,000 tons to 32,000 tons. A further expansion to 91,000 tons is planned for the end of 1996. Along with the expansion, the company will introduce a new magnesium chloride deicing agent. The largest domestic magnesium sulfate producer planned to add 25,000 tons per year of magnesium sulfate solution capacity in Utica, IL, by the end of 1995. Many Midwest customers were converting the magnesium sulfate crystal that the company already produces at the Utica site into solution, and the company was increasing capacity to meet this need. As part of framework agreement reached in 1994 to loosen sanctions, the President signed an Executive Order allowing the importation of magnesite from North Korea. One U.S. company has signed a supply agreement with a North Korean firm to import some magnesia into the United States. Shipments were expected to begin in the summer. With the increased prices for Chinese magnesia, magnesite from North Korea could become a growing source of U.S. supply in the future, depending on the quality. World Mine Production, Reserves, and Reserve Base: Magnesite production Magnesite reserves and reserve base5/ 1994 1995e/ Reserves Reserve base United States W W 10,000 15,000 Australia 79 100 NA NA Austria 173 170 15,000 20,000 Brazil 72 70 45,000 65,000 Chinae/ 432 400 750,000 1,000,000 Greece 58 60 30,000 30,000 India 144 140 30,000 45,000 Korea, Northe/ 461 460 450,000 750,000 Russiae 173 160 650,000 730,000 Serbia and Montenegro 20 20 5,000 10,000 Slovakiae/ 346 350 20,000 30,000 Spain 115 120 10,000 30,000 Turkey 288 280 65,000 160,000 Other countries 95 100 420,000 480,000 World total (may be rounded) 6/ 2,460 6/ 2,430 2,500,000 3,400,000 In addition to magnesite, there are vast reserves of well and lake brines and seawater from which magnesium compounds may be recovered. World Resources: Resources from which magnesium compounds may be recovered range from large to virtually unlimited and are globally widespread. Identified world resources of magnesite total 12 billion tons, and of brucite, several million tons. Resources of dolomite, forsterite, and magnesium-bearing evaporite minerals are enormous, and magnesia-bearing brines are estimated to constitute a resource in billions of tons. Magnesium hydroxide can be recovered from seawater. Substitutes: Alumina, silica, and chromite substitute for magnesia in some refractory applications. e/Estimated. NA Not available. W Withheld to avoid disclosing company proprietary data. 1/See also Magnesium Metal. 2/Defined as imports - exports + adjustments for Government and industry stock changes. 3/Tariffs are based on gross weight. 4/See Appendix B. 5/See Appendix C for definitions. 6/Excludes the United States. Mineral Commodity Summaries, January 1996