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The EU urgently must classify a substance used to line furnaces and kilns for making cement, glass and metal as a important uncooked materials or provides will change into hostage to China, the world’s greatest producer of high-end industrial ceramics has warned.
Stefan Borgas, chief government of London-listed RHI Magnesita, instructed the Monetary Occasions that whereas magnesite was important to fundamental chemical processes underlying Europe’s industrial base, its absence from a listing of strategically vital supplies had disincentivised homegrown manufacturing.
Magnesite is used to make refractories, supplies that permit furnaces to deal with extraordinarily excessive temperatures above 1,200C. Europe imports most of its magnesite from China, which controls two-thirds of worldwide manufacturing.
“We’ve sufficient magnesite in Europe that we may safe provide to the European heavy industries,” Borgas mentioned, including that EU important supplies designation was serving to to spice up funding within the mining and processing of lithium, nickel and different metals the place China additionally dominated provide.
“For positive it offers a lift to the European manufacturing of those supplies,” Borgas mentioned. “We’ve pure sources [but] Europe has uncared for its mining capabilities during the last 50 years.”
The decision by Vienna-based RHI Magnesita is an indication of how far China’s world surge in industrial exports in response to faltering home demand is extending past metal and different broadly used metals to lesser recognized however equally important supplies.
The corporate, which has a listed subsidiary in India and a market worth of about £1.5bn, is battling falling costs for refractories as Chinese language producers flip to exports to soak up extra capability. Factories in India are additionally investing in new refractory manufacturing because the nation pursues its steelmaking ambitions.
In an effort to spice up its provides of the commodities required to make clear applied sciences comparable to batteries and wind generators, the EU has listed 16 merchandise together with nickel, lithium and cobalt as “strategic” as a part of a Critical Raw Materials Act that units targets for his or her home extraction, processing and recycling.
Borgas argued that magnesite ought to be added to this checklist as a result of it additionally underpinned the processing and recycling of greater than half of those “strategic” minerals.
He mentioned that together with it on the checklist would additionally assist firms cluster collectively to put money into decarbonising high-emitting processes. The manufacturing of 1 tonne of magnesia from magnesite emitted about 1.8 tonnes of carbon dioxide, Borgas mentioned.
“Being on the strategic uncooked materials checklist helps to help funding in completely new applied sciences. [This is] uncharted territory, which for any single firm can be very dangerous. However as a cluster, this might change into very attention-grabbing.”
The worldwide provide of refractories is operating at about 40 per cent above demand however the provide chains for uncooked supplies, comparable to magnesite, have been changing into precarious, based on RHI Magnesita.
“For each constructing materials for contemporary society . . . you want refractories,” Borgas mentioned. “You want this ceramic insulation layer contained in the furnace with the intention to shield the crops and the folks from this sizzling materials.
“The Chinese language have invested into this based mostly on their sources and — very reliably, truly — provide the world . . . Europe and each different continent ought to take care that they not less than use what they’ve,” he mentioned.
The EU ought to replace the important uncooked supplies checklist by Could 24 2027, based on the act. Any materials should be assessed earlier than it may be added, an EU official mentioned.
