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  • Europe's Recovering Car Market Could Strengthen Magnesium Demand; CD International Enterprises, Inc. (CDII) Is Ready 0 comments
    Feb 12, 2014 1:19 PM | about stocks: CDII

    Forecasts that the European car market will end its six-year depression and start moving higher could trigger increased magnesium demand in 2014, according to media reports. The European Automobile Manufacturers' Association reports that car sales in Europe fell 2.8 percent in the first 11 months of 2013, though sales are expected to increase by up to 3 percent this year, albeit at significantly discounted prices.

    "With economic conditions showing a tepid recovery in most European countries by the end of 2013, buyers are finally starting to feel confident enough to make a long-delayed purchase of a new car - albeit at discounts of up to 24 percent," reports Automotive News Europe.

    Car sales in the UK are also on the rise, climbing to 2.26 million vehicles registered in 2013, an increase of 10.8 percent from 2102 sales, according to the Society of Motor Manufacturers and Traders (NASDAQ:SMMT). Furthermore, a July report from Roskill states that industry-wide efforts to make lighter vehicles could boost magnesium consumption by 5 percent a year to 2017.

    The ongoing strength of the UK car market, paired with expected growth in Europe, is good news for magnesium, which is used for a variety of industrial and consumer products, including automobiles. Magnesium is the lightest and strongest of structural metals, making it highly favored in automobile manufacturing. In essence, as car makers in Europe and the UK pick up the pace to meet rising demand, they'll need more metal - which means higher demand for magnesium.

    China currently leads the world's magnesium production, which for the first 11 months of 2013 was up 8.02 percent to 713,300 tonnes in the same period of 2012. China is also the world's biggest auto market. Chinese production is closely watched by car manufacturers and other magnesium end-users, who use the numbers as a wind-flag as to which way magnesium prices could move.

    CD International operates four facilities in China to produce and/or distribute magnesium products such as pure magnesium ingots, magnesium powders, granules and alloys. Current active annual production capacity within the company's magnesium segment is approximately 32,000 metric tons of pure magnesium. The company's goal is to emerge as a global leader in the production and distribution of pure magnesium and magnesium related products, and to this accord has consolidated its magnesium operations into its International Magnesium Group (IMG) subsidiary.

    Positioned to benefit from optimism in Europe's strengthening car market and subsequent magnesium demand, CD International intends to expand its domestic and international sales capabilities under the IMG brand to create a cohesive and unified worldwide marketing effort for production and distribution operations.

    For more information, visit cdii.com

    QualityStocks provides investor relations services to publicly traded companies in exchange for compensation. This article may be part of our efforts to widen a client's exposure. To read our full disclaimer, visit http://disclaimer.qualitystocks.net

    Stocks: CDII
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