Issue link: http://resourceworld.uberflip.com/i/638235
f e b r u a r y / m a r c h 2 0 1 6 www.resourceworld.com 49 a push market (the auto industry is a good example) the automakers create demand in the minds of people and push the prod- uct. A pull market is where the customer recognizes the value and the need for the product and pulls it toward them. Food is an example of a pull market as people know they need food." He continued, "Magnesium has the abil- ity to displace other materials. People are willing to do that because of the benefits incurred. The only problem is that the industry is limited in its capacity. When a new application comes on stream, there has to be sufficient capacity to fill it to absorb the new demand. Our approach is to come on the market at a price point that allows new innovation or utilization of the material and, as the market grows, it will pull our product from us. Sever noted that the magnesium indus- try is small compared to other industrial metals with magnesium prices negotiated a year in advance. "We would sell our products to foundries and die casters such as Alcoa and Kaiser and anyone that uses raw magnesium to make alloys such as alu- minum alloys. Ford Motor Company, for example, could then buy their products." The magnesium market has tripled since 2000 due to the inception of many new magnesium applications and China hav- ing the production capacity available to fill the demand. "Right now, there are new applications and not enough magnesium," explained Sever. "That's where we come in. We want to fill the North American need first and then expand to the world." "We are not relying on a protective North American tariff for our economic model," said Sever. "The 2025 CAFÉ stan- dard for gas mileage means that vehicles will have to weigh 300 to 500 lbs less than present. Department of Energy calculated that this weight reduction can be met using magnesium in six proven applica- tions. Unfortunately at this time, it would take 10 times current world magnesium production to satisfy the automotive demand. The approval by the FAA of the use on magnesium in the cabin and cockpit will also result in big demand for magne- sium alloys in aircraft that will result in huge fuel savings." "In the use of magnesium for alloying with aluminum for food containers, (bev- erage cans) the purity of the magnesium deposit is probably the most important fac- tor," said Sever. "Our Tami Mosi deposit meets the world standard for purity." n Building the bench-scale pilot furnace for testing magnesium ore. Photo courtesy Nevada Clean Magnesium Inc.