The concentration of original magnesium producers in the upstream of China’s magnesium alloy industry is low, and the output of leading enterprises is significantly ahead
There are many original magnesium manufacturers in China, but the overall production capacity is low. The head manufacturers represented by Nanjing Yunhai Special Metals Co.Ltd(002182) have strong competitiveness. In 2021, the annual output of raw magnesium and magnesium alloy in China will be about 903400 tons and 318000 tons respectively. Nanjing Yunhai Special Metals Co.Ltd(002182) is the largest producer of raw magnesium in China, with an annual production capacity of 100000 tons. The mining and production of magnesium industry has scale effect. The backward production capacity of small and medium-sized enterprises will gradually withdraw from the market, and the industry concentration will be further improved.
Rich magnesium alloy reserves provide power for the development of magnesium alloy industry
Compared with aluminum, iron, copper and other metal minerals, magnesium resources have unique reserve advantages. Because of its unique material properties, it can be exploited in evaporated mineral liquid resources. According to Nanjing Yunhai Special Metals Co.Ltd(002182) prospectus, there are about 38 grams of magnesium chloride and 17 grams of magnesium sulfate in every kilogram of seawater, and about 210 billion tons of magnesium in seawater. Therefore, there will be sufficient exploitation space for American resources. In the future, with the gradual depletion of other metal resources, the huge reserves of magnesium resources will provide sufficient power for magnesium alloys to replace traditional metal materials.
03 the synergy between upstream, middle and downstream of magnesium alloy industry will gradually increase, and the industrial chain will develop towards integration
The market scale of magnesium alloy industry is small, and the integration of industrial chain helps to improve the profitability of enterprises: in 2021, China’s raw aluminum output was 389200 tons and the raw magnesium output was 903400 tons, with a difference of about 43.1 times. Limited by the output scale, the original magnesium producers will rely heavily on the development of the middle and lower reaches of the industrial chain. By expanding to the production and processing of magnesium alloys in the middle and lower reaches, the upstream enterprises can improve the added value of products and improve the profitability of the company. At the same time, the integration of the middle and lower reaches can accelerate the implementation and application of new magnesium alloy technology and drive the rapid development of the downstream market.
