In the near future, the ministry of environmental protection has made great efforts to actively deploy the key work in the second half of the year, and the fourth batch of environmental supervision will soon begin. At the same time, the ministry reported on July 14, by the end of June, Beijing-Tianjin-Hebei in 28 cities and surrounding areas have checked out disqualified 17.6 enterprise, cannot upgrade satisfy the business, this year will shall be closed before the end of September.
Environmental consolidation is a frequent occurrence in the magnesium industry, and it is not the first time that such a policy impact has involved China's refractory industry.
More than a decade ago, Shanxi Province's bauxite and fused alumina producers also encountered similar problems, even if at the time, the traditional type vertical shaft kiln has been used widely at the time, but because of environmental problems, the government still to take measures to shut it down. Today, the factories of the calcined bauxite industry in Shanxi are also rectification or even close in the new round of environmental inspection.
However, the current situation of China's magnesium industry is affected not only by the environmental protection industry, but also by the reduction of export quotas and the export tax of magnesite and magnesium products, as well as the important factors.
The export system of certain mineral products established in 1994 has caused some problems to the global mineral producers and traders as well as consumers.
Starting from April 1, 1994, in order to better control the mineral exports and domestic resources development, more is in response to the European anti-dumping duties measures, the Chinese government began to magnesia, magnesia and other 13 kinds of minerals export restrictions, not April fool's joke.
In addition to allocating a total quota on exports, the government also requires potential exporters to export licenses. If the export is successful, a certain export fee must be paid (in RMB per ton). More crucial is the limited number of permits, which operate in half of the total export volume every two years.
Chinese government's export policy, in our view, is essentially a "mineral tax", the concept of its ably let exporters and traders to take more responsibility, to export and traders, exporters a degree of control.
In the years that followed, more negative taxes followed, such as the removal of VAT rebates, resource taxes and export taxes. Also caused the results, and in a few years in a row, which are not effectively improve the system of chaos and non-standard caused mineral trade industry, so they have been used to the end of each year waiting for the latest policy adjustments.
Export policy has just introduced, because it can avoid the risk of being dumped for western mineral market, won the identity of people, but the export licensing system is the implementation of the export trade brings a series of problems:
1. Prices have skyrocketed and become unpredictable.
2. Some Chinese companies that fail to obtain export licenses cannot export.
3. Companies that failed to obtain export licenses in the first round may raise product prices to obtain export licenses in the second round.
4. Causing confusion among exporters, companies with export licenses and companies with no export licenses will have "underground transactions".
5. Traders cannot vouch for the price and delivery of customers.
6. Failing to meet export quotas.
7. The phenomenon of the smuggling of magnesia has gradually increased.
Back in 1994 according to the Chinese magnesia export policy, there is no denying that, which also saw the CCCMC (China) mineral management department of the policy debate and eliminating the possibility of (especially) in recent years.
In 2016, the export quota of the magnesium sand was 1.26 million tons, and the export license price was 140-330 RMB per metric ton ($20-48 per metric ton). The export tax of light burned magnesia is 5%, and the magnesia and magnesite sand is 10%.
Things turned around late last year, when the United States and the European Union filed a case against China over tariffs on several minerals and metals, including magnesium.
Its pressure on the world trade organization to the Chinese government to trade the rectification of things is not the first time, a few times before action has made a number of products has cancelled the export tax: such as bauxite, fluorite and silicon carbide, 2009, and the rare earth in 2015.
Another factor was the government's approval of seven new free trade zones in response to the slowdown in economic growth from August 31, 2016. These areas clearly include Liaoning, plus Chongqing, Zhejiang, Hubei, Henan, Sichuan and Shaanxi, which brings the total number of free trade zones to 11.
The ministry of commerce on October 30, 2016 for the first time confirmed magnesia (including talc and graphite) cancel the export quota restrictions, its 60 file: 2017 industrial and mining products total export quota list officially released at the website, since 1994, magnesite and talc is not in the list for the first time, phosphorene, silver is still in the list.
However, there was no immediate official response from the management and export departments of the magnesium industry, which caused almost two months of speculation and concern in the industry.
Until the end of December 2016, the ministry of commerce official officer Xuan on some of its export commodity tax adjustment, to take effect on January 1, 2017, which include magnesite and antimony, tin, indium, graphite and talc, etc.
After 23 years of market rectification, the decision appears to have come suddenly. Still, there is still some confusion about China's export market, which is still a problem, even though there is no cost to export the magnesite at present.
Some experts are also concerned about the threat of a potential "resource protection tax" that the government will not use to compensate for the reduction in tax revenue from the export tax. Factories and caused by the environmental protection check and supply problems, makes dead burned magnesia and fused magnesia a strong rebound in prices, the factors of instability, let traders to become more optional product pricing. Steel mesh according to my survey, some recent magnesia enterprises began to an increase in the price of the market, the current 96 specifications of the fused magnesia market price is 3950-4250 yuan/ton, 97 specifications of the fused magnesia market price is 4450-4750 yuan/ton, 98 specifications of the fused magnesia market price is 4850-5150 yuan/ton, respectively than early raised 800 yuan/ton, 500 yuan/ton and 400 yuan/ton, up 12%, 12% and 8.7% respectively.
However, the export of some refractory raw materials is not satisfactory, according to Dianli Xu, secretary-general of the society of materials. Refractory raw materials in recent years, the average export price continues to decline, especially in the country to cancel aluminum refractory clay after export quotas and export tariffs, export average prices from 2013 began to decline in a row, to 2016 fell by 16.12%, 2.95%, 10.38% and 16.45%. In February, it fell 14.38 per cent year on year, down 13.28 per cent from January to February.
In 2017, the state of magnesia, light burning magnesium and graphite cancelled export quotas and export tariffs, in January, sintered magnesia, fused magnesia, light burning magnesium and graphite exports surging 143.68%, 167.59%, 58.52% and 167.59% respectively, and the average export price year-on-year plunged 21.37%, 14.46%, 20.79% and 21.37% respectively. February continued the decline in January, with the average price of exports falling 30.29 percent, 25.11 percent, 29.19 percent, and 16.39 percent respectively. The decrease of sintered magnesia, magnesite and light burning magnesium decreased by 8.92, 10.65 and 8.4 percentage points in January.
In January and February, the average price of sintered magnesia, magnesite, light burned magnesia and graphite was down by 24.71%, 17.48%, 24.30% and 19.45% respectively.