Sep. 09, 2024
Chemicals
Magnesium is an essential mineral when it comes to many biological functions. Among other things, it factors into over 300 different enzyme systems that keep various bodily reactions regulated, including muscle function and protein synthesis. It also has many crucial applications within the industrial world as an essential metal.
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However, the actual production of usable magnesium can vary quite a bit from country to country thanks to a variety of different factors. Here&#;s a closer look at how the data breaks down in .
China is by far the world&#;s biggest producer of magnesium, yielding an estimated 17 million metric tons each year and accounting for more than 80 percent of the world&#;s total magnesium exports. Some of the other current world leaders in magnesium production include:
Russia &#; 86,571 million metric tons
United States &#; 68,226 million metric tons
Israel &#; 35,741 million metric tons
Australia &#; 2.6 million metric tons
Turkey &#; 1.8 million metric tons
Brazil &#; 1.5 million metric tons
Austria &#; 800,000 million metric tons
Spain &#; 620,000 million metric tons
Kazakhstan &#; 23,000 million metric tons
China&#;s dominance as far as the global magnesium industry can be attributed to a number of factors, including but not necessarily limited to the presence of abundant natural magnesium deposits and the nation&#;s ongoing investment in its production infrastructure.
A number of different factors may impact a particular country&#;s ability to produce magnesium on its own. Some examples include the following.
Countries (such as China) that have substantial natural deposits of magnesium ore within their borders will have a natural advantage in the industry over countries without this.
Having the ore to mine is one thing, but successfully extracting it and putting it on the market are different concerns entirely. A country with well-developed mining technology and access to a labor force with the skill to put it to good use will have an edge over the competition.
Whether or not a country&#;s government policies support ample magnesium production can factor into the equation, as well. Examples of government-managed factors that may contribute include tax incentives, trade regulations, and subsidies.
Ongoing or temporary geopolitical tensions can affect a country&#;s magnesium production abilities by interrupting supply chains, causing trade disputes, and potentially affecting relationships with other players in the global market.
Additional factors, such as natural disasters, climate change, or various economic trends can also impact various countries involved in magnesium production and exports.
In this article, we will discuss the 12 largest magnesium-producing companies and the best magnesium stocks to buy now. If you want to skip our discussion on the growth prospects of the industry, go to the 5 Largest Magnesium Producing Companies and Best Magnesium Stocks To Buy.
According to a report issued by market intelligence firm SkyQuest Technology, the global magnesium market is set to compound annually at an average rate of 5.3% from a size of $4.8 billion in to $7.25 billion by the end of this decade. Another report says the production of magnesium is set to increase at a compound annual growth rate (CAGR) of 5.30% from 1.09 million tons in to 1.42 million tons by . Magnesium is considered one of the lightest metals in the use of mankind today. It is considered 30% lighter than aluminum and is widely used in alloys. Given the benefit of being lightweight and having a high melting point, magnesium is widely used by aircraft and automotive industries. Around 70% of the total global production of magnesium is used to make alloys. Meanwhile, 10% of global magnesium production is used as a raw material in making titanium, which is known for its resistance to corrosion. Another 10% of global magnesium production is diverted towards making steel for the construction industry. The significance of magnesium is further reiterated by the fact that most of the beverage cans in the US are made by forming an alloy with 5% magnesium.
The automotive industry combines aluminum with magnesium to form an alloy for various components. According to the US Automotive Material Partnership, one pound of magnesium can replace two pounds of steel and 1.67 pounds of aluminum. This can result in automobile companies reducing the weight of their vehicles by 15%. Any reduction in weight means an improvement in fuel efficiency, which helps reduce carbon emissions and contribute towards safeguarding the environment. According to Australia-based company Latrobe Magnesium (LMG.AX), automobile manufacturers in China intend to increase the weight of magnesium in cars from 18.95 pounds in to 99.2 pounds by the end of this decade.
Key Players in the Industry
Magnesium is usually obtained from natural minerals like dolomite and magnesite in the form of carbonate. There is a 0.13% presence of magnesium in the form of carbonate in seawater as well. China is the biggest producer of magnesite in the world and is responsible for 63% of the global production, with an annual production of 17 million tons. China has emerged as a top magnesium producer in the past 20 years and is now home to the largest magnesium deposits in the world. Australia, Turkey, Brazil, and Russia are the second, third, and fourth biggest producers of magnesite, with an estimated annual production of 2.6 million tons, 1.8 million tons, 1.5 million tons, and 950,000 tons, respectively.
In the North American region, US Magnesium is a prominent magnesium-producing entity with a claimed annual production capacity of 63,500 tons of primary magnesium. US Magnesium is a privately held company that was established in . The company has an 80,000-acre production facility 60 miles away from Salt Lake City, Utah. Similarly, Dead Sea Magnesium and Shanxi Yinguang Magnesium Industry (Group) Co. are also among the largest magnesium-producing companies in the world. Investors looking to gain exposure to the industry are also investing in magnesium ETFs and the best magnesium stocks, such as Martin Marietta Materials, Inc. (NYSE:MLM), Albemarle Corporation (NYSE:ALB), and Jinduicheng Molybdenum Co., Ltd. (.SS).
12 Largest Magnesium Producing Companies and Best Magnesium Stocks To Buy
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Our Methodology
To shortlist the largest magnesium-producing companies and the best magnesium stocks, we analyzed the hedge fund sentiment toward each stock and the market capitalization of the companies. The hedge fund sentiment has been assessed using Insider Monkey&#;s database of 910 hedge funds as of Q2 . The companies have been ranked in ascending order of their market capitalization as of September 1. By considering these two key criteria, we have curated a comprehensive list of the leading publicly listed companies in the magnesium industry and the best magnesium stocks.
Market Capitalization: $323.6 million
Number of Hedge Fund Holders: 14
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Related links:Value of Hedge Fund Holdings: $88,574,169
Luxfer Holdings PLC (NYSE:LXFR) is a Milwaukee, Wisconsin-based industrial materials manufacturer founded in .
Luxfer MEL Technologies and Luxfer Magtech are two subsidiaries of the company that are involved in the magnesium value chain. Luxfer MEL Technologies makes magnesium alloys for application in the defense, automotive, oil, and gas industries. Meanwhile, Luxfer Magtech is involved in making magnesium chips, granules, and powders for various industries. The company has the distinction of being the founding member of the International Magnesium Association. Click here to read Luxfer Holdings PLC&#;s (NYSE:LXFR) Q2 earnings call transcript.
Market Capitalization: $364.47 million
Number of Hedge Fund Holders: 8
Value of Hedge Fund Holdings: $18,803,848
Intrepid Potash, Inc. (NYSE:IPI), headquartered in Denver, Colorado, specializes in potash production.
Magnesium is one of the key constituents of the potash manufactured by the company. Intrepid Potash, Inc. (NYSE:IPI) obtains magnesium from langbeinite, which contains potassium-magnesium sulfate. The company mines langbeinite from its mine in New Mexico. First Eagle Investment Management was the leading hedge fund investor in Intrepid Potash, Inc. (NYSE:IPI) during Q2 . The hedge fund increased its stake in the company by 251% during the second quarter of the year. You can also check out the 10 Best Potash Stocks to Buy here.
Market Capitalization: $1.0 billion
Number of Hedge Fund Holders: 20
Value of Hedge Fund Holdings: $43,531,476
U.S. Silica Holdings, Inc. (NYSE:SLCA) is a Katy, Texas-based miner, processor, and logistics provider of minerals with a portfolio of over 1,500 products.
One of the materials produced by U.S. Silica Holdings, Inc. (NYSE:SLCA) is magnesium silicate. Magnesium silicate is a mineral compound that has numerous applications, such as being used as a filler in products like plastics, rubber, and paints, as well as in the production of ceramics and certain pharmaceuticals.
During its Q2 earnings call transcript, U.S. Silica Holdings, Inc. (NYSE:SLCA) maintained its projection of capital expenditure in the range of $50 to $60 million. The company is also considering the possibility of accelerating its capital investments to support growth initiatives.
Market Capitalization: $1.01 billion
Number of Hedge Fund Holders: 22
Value of Hedge Fund Holdings: $106,469,550
Ferroglobe PLC (NASDAQ:GSM) is a London, UK-based provider of specialty metal products and alloys. The company is also involved in the production of Magnesium ferrosilicon (FeSiMg) alloy. Magnesium serves as the fundamental raw material to produce any FeSiMg alloy. The magnesium component in the FeSiMg alloy can vary, typically falling within the range of 5% to 10%. This alloy holds significant importance in the iron foundry industry, where it plays a critical role in various applications and processes.
According to data compiled by Insider Monkey, Hosking Partners is the biggest hedge fund holder of Ferroglobe PLC (NASDAQ:GSM), with a stake valued at over $20.7 million as of Q2 . The hedge fund increased its holding in the company by 10% on a sequential basis. Click here to read Ferroglobe PLC&#;s (NASDAQ:GSM) earnings call transcript for Q2 .
Market Capitalization: $1.25 billion
Number of Hedge Fund Holders: 11
Value of Hedge Fund Holdings: $24,161,338
Kaiser Aluminum Corporation (NASDAQ:KALU) is a Franklin, Tennessee-based aluminum maker founded in .
Kaiser Aluminum Corporation (NASDAQ:KALU) sources magnesium for its Warrick Rolling mill in Indiana, which is used to make aluminum-based beverage and food packaging products. Kaiser Aluminum had to declare force majeure in July last year. This decision was prompted by a force majeure declaration made by their magnesium supplier, US Magnesium LLC, in mid-. However, Kaiser Aluminum Corporation (NASDAQ:KALU) successfully resolved this issue and lifted the force majeure in September by securing magnesium supply from alternative sources, ensuring the continuity of their operations.
Market Capitalization: $1.26 billion
Number of Hedge Fund Holders: 18
Value of Hedge Fund Holdings: $114,899,170
Compass Minerals International, Inc. (NYSE:CMP) is an Overland Park, Kansas-based minerals producer that has the honor of being the biggest producer of magnesium chloride in the US. The company sources the mineral from the Great Salt Lake in Utah by having it separated from water through the oldest and one of the most energy-efficient techniques of solar evaporation. Magnesium chloride can be used as a stand-alone deicer and additive.
Click here to read Compass Minerals International, Inc.&#;s (NYSE:CMP) earnings call transcript for Q3 .
Market Capitalization: $1.79 billion (CNY 13.03 billion)
Nanjing Yunhai Special Metals Co., Ltd (.SZ) is a Jiangsu, China-based company majorly focused on making magnesium-based alloys. The company has magnesium smelting and processing facilities located in the city of Nanjing in the Jiangsu Province of China.
Nanjing Yunhai Special Metals Co., Ltd (.SZ) has an annual production capacity of around 50,000 metric tons of magnesium ingots and magnesium powder. The company uses a thermal reduction process to produce magnesium from dolomite ore. This is an energy-intensive process that requires high temperatures to reduce magnesium oxide into pure magnesium metal.
In addition to Nanjing Yunhai Special Metals Co., Ltd (.SZ), Martin Marietta Materials, Inc. (NYSE:MLM), Albemarle Corporation (NYSE:ALB), and Jinduicheng Molybdenum Co., Ltd. (.SS) are also among the best magnesium stocks to buy.
Click to continue reading and see the 5 Largest Magnesium Producing Companies and Best Magnesium Stocks To Buy.
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Disclosure: None. 12 Largest Magnesium Producing Companies and Best Magnesium Stocks To Buy is originally published on Insider Monkey.
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