Western Magnesium Corp has said recent research into the global magnesium market had reinforced its view that now was the time to return production of the commodity to North America - for economic and national security reasons.
The firm aims to be a low-cost producer of green, primary magnesium metal and is expected to start production from a commercial plant in Ohio by the end of this month.
Analysts reckon the global market for magnesium will grow by nearly 50% by 2028, said the firm, while reports, including from Acumen Research and Consulting, predict the US$4.3 billion global market will be worth US$6.4 billion by the end of the decade thanks to surging post-COVID-19 demand from auto, aerospace, and electronics industries.
"Over twenty years ago, North America gave up on its share of producing magnesium metal and ceded the market to China," said Western Magnesium's CEO Sam Ataya in a statement.
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"Now, with demand rising, we are about to bring production back and put the United States on a footing to first supply domestic needs and then focus on supplying the global demand with the magnesium it needs to produce the next generation of goods that will be the most environmentally friendly since the start of the Industrial Revolution."
Acumen reckons the industry's compounded annual growth rate will be above 5% through 2028, reported Western Magnesium.
And while China has supplied close to 90% of the world's magnesium, the Acumen report noted the difficulties that Chinese producers have had accessing energy needed to keep up, it added.
"These hurdles in China have opened the door to new production sites. Acumen noted that production is expected to grow in India and listed Western Magnesium Corporation as a 'major player' that will shape production trends in the coming years," said the company.
The location of the company's first full-scale commercial plant is in Harrison County, Ohio, and the company said it is currently selecting future plant locations in the USA.
Unlike costly and highly polluting production processes, the firm plans to use a continuous silicothermic process to produce magnesium, which significantly reduces labor and energy costs compared to current methods, while being environmentally friendly.
Contact the writer at giles@proactiveinvestors.com