Further bad news for metals consumers: alloying element shortages - MetalMiner

We wrote recently about the impact power rationing and rising coal costs were having on metals producers in Europe.

Well, it would seem that is not the only driver pushing semi-finished product prices higher this month.

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Aluminum prices, alloying element shortages

The LME aluminum price been rising relentlessly. Furthermore, the availability of alloying elements is becoming so acute, both in terms of price and deliveries, that producers are sending out notes to clients advising that global shortages of raw materials like magnesium — critical in alloying higher grades of aluminum — could result in production stoppages and sharply higher prices later this quarter.

The problem, as is so often the case in the metals markets, is that China is the world’s largest source of alloying magnesium. That is in addition to a host of other similar metals, like manganese.

However, power rationing has impacted production there. European mills have no idea when this shortage will ease. They clearly feel the implications, both in terms of further price rises and delivery delays, which are so acute that they need to warn the market to set expectations.

Challenges in China’s metals sector

Nor are the producers of alloying elements the only part of the Chinese metal production landscape hit by power problems.

Some rolling mills recently announced a...

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