Russia Launched Industrial Production of Rare-Earth Magnesium Alloys, While Germany’s "Magnesium-Based Hydrogen Slurry" Technology Faced Systematic Questioning [SMM Survey]

Published: Mar 19, 2026 14:56 (GMT+8)
Russia’s Solikamsk Magnesium Works recently launched industrialised production of magnesium alloys containing rare earth elements such as neodymium, cerium, and lanthanum. The products combine lightweight properties with high strength and are mainly targeted at sectors including aerospace and automotive manufacturing. The plant accounts for 100% of Russia’s rare earth compound production and 75% of its magnesium capacity, and this capacity expansion further consolidates its position in the strategic metals sector. Meanwhile, the “magnesium-based hydrogen slurry” technology developed by Germany’s Fraunhofer Institute has sparked controversy. Independent analysis indicated that the technology’s overall system efficiency is only about 10, its energy density is comparable to that of lithium batteries, its cost is far higher than expectations, and its recycling chain has yet to form a closed loop. It is only suitable for demonstration scenarios at the hundred-watt level and is unlikely to achieve commercial application. The two pieces of news reflect the different technological pathways and industrialisation prospects of magnesium-based materials in high-end manufacturing and energy storage.

Russia’s Solikamsk Magnesium Plant Launches Industrial Production of Rare Earth-Containing Magnesium Alloys

Solikamsk Magnesium Plant (SMP), a subsidiary of Russia’s Rosatom, recently announced that it has launched industrial production of magnesium alloys containing rare earth elements such as neodymium, cerium, and lanthanum. These new-type materials combine lightweight and high-strength properties, can significantly reduce structural weight and improve equipment energy efficiency, and are recyclable, classifying them as “green engineering” materials. The products are mainly targeted at aerospace, automotive manufacturing, energy, and the oil and gas industries. The introduction of rare earth additives enhanced the material’s load resistance and extended the service life of key components. Solikamsk Magnesium Plant began magnesium production in 1936 and started extracting rare earth metals from loparite concentrate in 1958. At present, the plant accounts for 100% of Russia’s capacity for rare earth compounds, niobium, and tantalum, as well as 75% of magnesium and 4% of titanium production.

Fraunhofer’s “Magnesium-Based Hydrogen Paste” Technology Faces Questions Over System-Level Efficiency and Cost

The Powerpaste technology developed by Germany’s Fraunhofer Institute recently sparked renewed discussion. Based on magnesium hydride, the technology releases hydrogen through reaction with water for use in fuel cells, aiming to avoid the safety and cost challenges of high-pressure hydrogen storage. However, independent analysis indicated that its full-system performance fell far short of promotional claims.

The core issues lie in energy density and efficiency. According to estimates, producing 1 kg of hydrogen requires about 10 kg of hydrogen paste and 9 kg of purified water, for a total weight of 19 kg, corresponding to a system-level energy density of only about 0.3-0.4 kWh/kg, comparable to lithium batteries rather than superior to them. Upstream magnesium production consumes as much as 80-110 kWh/kg hydrogen, resulting in an electricity-to-electricity full-chain efficiency of only about 10%. The reaction process releases a large amount of heat, about 19 kWh/kg hydrogen, requiring complex thermal management. Hydrogen output rates are limited, and purification is required to make it compatible with proton exchange membrane fuel cells. On the cost side, magnesium production energy consumption alone raised costs by $4-$11/kg hydrogen, not yet including system hardware and logistics.

Fraunhofer’s claimed cost of 2 euros per kilogram of hydrogen paste covers only raw materials, while the full system cost is an order of magnitude higher. The recycling chain has also not been closed, as smelting magnesium hydroxide back into magnesium requires high energy consumption. The analysis held that the technology is suitable only for demonstration scenarios in the hundreds-of-watts to kilowatt range and cannot meet large power demands such as ships. In essence, it is “energy destruction” rather than energy storage, and no system-level advantage exists.

 

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM's internal database model. They are for reference only and do not constitute decision-making recommendations.

For any inquiries or for more information, please contact: lemonzhao@smm.cn
For more information on how to access our research reports, please contact:service.en@smm.cn
Related News
China Magnesium Ingot Bottoms Out with Slight Rebound, Demand Picks Up but Momentum Limited [SMM Magnesium Weekly Review]
23 hours ago
China Magnesium Ingot Bottoms Out with Slight Rebound, Demand Picks Up but Momentum Limited [SMM Magnesium Weekly Review]
Read More
China Magnesium Ingot Bottoms Out with Slight Rebound, Demand Picks Up but Momentum Limited [SMM Magnesium Weekly Review]
China Magnesium Ingot Bottoms Out with Slight Rebound, Demand Picks Up but Momentum Limited [SMM Magnesium Weekly Review]
[SMM Magnesium Weekly Review: China Magnesium Ingot Bottoms Out Slightly, Demand Provides Limited Boost] This week, the magnesium industry chain showed a weak consolidation pattern, initially declining before rebounding. For raw material dolomite, high-grade ore from local mines in Shanxi remained tight due to production halts, prompting smelters to expand their external procurement radius to supplement supply, while dolomite prices held steady. Magnesium ingot prices in main production areas edged down during the week, but just-in-time procurement recovered somewhat on lower prices, and prices bottomed out. However, after cargo release, upward momentum was insufficient. FOB prices in foreign trade also rose slightly, with transactions improving on phased delivery orders, though overseas end-users pushed significantly for lower prices, limiting upside. Magnesium powder consolidated in tandem with magnesium ingot costs, with both domestic and ex-China demand remaining weak, limited to just-in-time small orders. Magnesium alloy orders contracted notably in Q4, and despite production cuts by manufacturers, oversupply remained difficult to alleviate. End-use demand from sectors such as automobiles showed weak momentum, keeping the overall market soft in the short term. Key focus should be on the implementation of production cuts at domestic smelters and overseas procurement orders.
23 hours ago
Ex-China Primary Magnesium Projects Diverge: Australian Company Races to Produce Magnesium by Year-End While New Capacity in Europe and the US Faces Hurdles [SMM Survey]
Nov 05, 2026 13:57 (GMT+8)
Ex-China Primary Magnesium Projects Diverge: Australian Company Races to Produce Magnesium by Year-End While New Capacity in Europe and the US Faces Hurdles [SMM Survey]
Read More
Ex-China Primary Magnesium Projects Diverge: Australian Company Races to Produce Magnesium by Year-End While New Capacity in Europe and the US Faces Hurdles [SMM Survey]
Ex-China Primary Magnesium Projects Diverge: Australian Company Races to Produce Magnesium by Year-End While New Capacity in Europe and the US Faces Hurdles [SMM Survey]
[SMM Magnesium Survey: Ex-China Primary Magnesium Projects Diverge as Australian Firm Races Toward Year-End Output While New Capacity in Europe and US Hits Roadblocks] Ex-China primary magnesium projects are moving in opposite directions. Australia's Latrobe Magnesium demonstration plant has reached 98% installation completion with commissioning more than halfway through, and a rights issue has been completed, keeping the target of first magnesium metal output by the end of the year on track. In Europe, Romania's Verde project has secured strategic status but funding has fallen through, and the local government has rejected its planning application, leaving the project's prospects uncertain. Meanwhile, US Magnesium has completed its asset sale hearing, marking the complete exit of domestic primary magnesium capacity in the US.
Nov 05, 2026 13:57 (GMT+8)
Latrobe Magnesium Reaches 98% Installation, Aims for 2026 Production Goal; South Carolina Plant Advances
Nov 05, 2026 13:44 (GMT+8)
Latrobe Magnesium Reaches 98% Installation, Aims for 2026 Production Goal; South Carolina Plant Advances
Read More
Latrobe Magnesium Reaches 98% Installation, Aims for 2026 Production Goal; South Carolina Plant Advances
Latrobe Magnesium Reaches 98% Installation, Aims for 2026 Production Goal; South Carolina Plant Advances
【SMM Magnesium Flash】On November 2nd, Latrobe Magnesium released a project update stating that as of October 31st, the installation progress of its Victoria state demonstration plant Phase 1B has reached 98%, and the overall commissioning progress has doubled from 25% at the end of September to 50%. The goal of producing the first batch of magnesium metal with a purity of over 98% by the end of 2026 remains unchanged, and project expenses are controlled within the original budget of AUD 6.1 million. At present, all 30 sets of distillation tanks and condenser components have passed vacuum testing, the ball mill has been fed, and the compaction zone commissioning has been started. The company stated that 100% of the magnesium metal in the demonstration factory has been supplied to the US market through Metal Exchange LLC. In addition, its South Carolina magnesium plant project with an annual output of 50000 tons has signed a non binding letter of intent for a 250 acre plot of land in the Colton large industrial base, with railway, port, and power access conditions, and reserved space for expansion to 100000 tons of production capacity.
Nov 05, 2026 13:44 (GMT+8)
Register to Continue Reading
Gain access to the latest insights in metals and new energy
Already have an account?Sign in here