Europe to Resume Magnesium Mining to Reduce Dependency on China
Europe is set to restart magnesium mining to reduce its reliance on critical raw materials from China for the first time in a decade.
According to a report from the Financial Times, last Friday (April 12), Romania granted authorization for the Bucarest-based Verde Magnesium company to reopen a mine that had been closed since 2014.
Supported by the American private equity fund Amerocap, Verde Magnesium will invest $1 billion to build processing facilities aimed at promoting renewable energy use and aluminum recycling.
The project is expected to start production by the end of 2027, with an annual output of 90,000 tons, accounting for half of the EU’s supply and 9% of global production.
More than 90% of Magnesium used by the Verde Magnesium group – a crucial material for manufacturing lightweight aluminum alloys for cars and packaging – is currently imported from mainland China.
Approximately 87% of global magnesium supply and 95% of Europe’s consumption come from China, but with rising energy prices, China has significantly cut production to save electricity.
In 2022, due to persistently high energy prices, aluminum production in China was temporarily halted, leading to severe disruptions in Europe’s aluminum industry and prompting warnings of factory closures from the Verde Magnesium group.
Bernd Martens, Chairman of Verde Magnesium and former Audi executive, told the Financial Times that mining operations in Romania will help the EU achieve self-sufficiency in crucial metals needed for green transformation, thus reducing dependence on Chinese supply chains.
Martens stated, “The European industrial sector urgently needs reliable supplies of key strategic metals, especially those with lower carbon footprints than current imported metals, to support Europe’s transition to a carbon-neutral economy.”
Following inclusion in the list of key investment projects by the European Raw Materials Alliance, supported by the European Commission, the company is likely to apply for funding from EU support mechanisms.
The EU has set new mining targets under the Critical Raw Materials Act. The EU aims to mine 10% of the essential minerals it needs, process 40% of minerals, and recycle 15% of minerals by 2030.
Martens expressed confidence in the resumption of magnesium mining despite past challenges from local opposition and environmental concerns.
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