Among the many global supply chain issues industry is experiencing, there is now a magnesium anode "crisis" in the cathodic protection industry. Over the recent weeks and even days, magnesium anode prices have risen to levels never before seen, have over quadrupled at the time of this writing, and continue to be extremely volatile. To make matters worse, the anode supply chain has suffered several setbacks of late, causing shortages to the anode supply
For all industrial uses, the largest producer of magnesium is China, and for several reasons, the supply chain is unstable. There is one manufacturer in the U.S., but in comparison to China, their production output is small. This means that most of the world's supply comes from China, and to our knowledge, they are the only supplier of magnesium alloy anodes.
As a country, China is experiencing many issues, including power shortages, environmental challenges, and weather-related (drought) issues. At times, officials in China will simply shut down industrial sectors in an attempt to conserve power or reduce pollution. These mandated shutdowns are unplanned and can occur without advance notice. This has occurred in one region of China where magnesium is produced and has reduced production by a large percentage.
To quote a recent article by Fastmarkets MB, an intelligence service for the metals and mining industry, "The Fugu Power Supply Bureau was ordered by the county government to cut off electricity supplies to 84 high-energy consuming companies within the county on Sunday, September 19. Companies affected cover industries such as calcium carbide, ferro-alloy, semi-coke and magnesium. Of the 84 companies subject to the power cuts, around 18 are magnesium and magnesium alloy producers."
What is the answer? While magnesium is produced in the U.S., there are no producers of magnesium anodes in the U.S. If there are other anode manufacturers globally, we have not yet located them. Even if they exist, their prices will increase due to demand and market pressures. In the cathodic protection industry, we must change our thinking and designs while magnesium is in such short supply and at high price levels. We suggest quickly moving to alternatives, such as other sacrificial anodes (zinc) or impressed current (powered) systems, to offset the lack of magnesium anodes.
For customers with ongoing cathodic protection projects where large numbers of magnesium anodes are required, you simply may not be able to obtain the anodes you need at present and into the near future. Therefore, we suggest you begin taking action now to plan for alternatives.
During this difficult time, the Farwest team is ready to assist you in finding solutions. While we have a supply of magnesium anodes, we have many order commitments and will run out of magnesium anodes in the future. We believe that even if we can obtain magnesium anodes, the radically high price will dissuade customers from buying. Therefore, we are here to help find possible alternatives and solutions.