The sharp rise of magnesium price is unprofitable for processing enterprises-- Review and Prospect of magnesium Market in September

Aluminum is an industrial metal widely used in the manufacture of automobile and building materials. Recently, Matalco Inc., the largest manufacturer of aluminum billet in the United States, is in short supply of basic raw materials of aluminum. Customers have been warned that the company could cut production and limit supply as soon as next year.

At present, the supply crunch has pushed the international aluminum price to near an all-time high, and some investors are even betting that the aluminum price will rise to 4000 US dollars. The shortage of basic raw materials for aluminium is likely to exacerbate supply pressures.

In a letter to customers, Matalco said: "magnesium supplies have dried up in the past few weeks and we are unable to buy the magnesium we need to meet all demand in 2022. The purpose of this report is to provide a forewarning that if supply shortages persist (especially if things get worse,), Matalco may need to cut production in 2022, thus affecting our customers. "

Matalco also said difficulties in the supply of other raw materials and soaring natural gas prices added to these challenges.

At the same time, AA.US, the largest primary aluminum producer in the United States, has expressed concern about magnesium shortages and has been seeing so-called force majeure statements from some suppliers. It is understood that force majeure clauses are generally attached to sales contracts, which allow suppliers to suspend delivery due to circumstances beyond their control.

In addition to magnesium, Matalco and Alcoa point out that silicon, another raw material for aluminum, is also in short supply. It is reported that because of the shortage, the price of silicon has risen by 300% in less than two months.