Policy Factors Affecting the Market Development of Magnesium Sulfate Heptahydrate

The market development of magnesium sulfate heptahydrate is affected by global multi-dimensional policy factors, covering international trade rules, environmental standards, industry access, agricultural support and emerging industry orientation. The following are key policy factors and their influencing mechanisms:
I. International trade policies and barriers
Tariffs and anti-dumping measures:
Countries have significant differences in import tariffs on magnesium sulfate heptahydrate. For example, China's preferential import tariff on magnesium sulfate heptahydrate is 5%, and the general tariff is 30%. The United States has imposed an anti-dumping duty of 141.49% on Chinese magnesium metal. Although it is directly aimed at magnesium metal, it may indirectly affect the export cost of magnesium sulfate heptahydrate with magnesium ore as raw material. In addition, emerging markets such as India and Turkey may protect local production capacity by raising tariffs. For example, in 2024, China's agricultural-grade magnesium sulfate heptahydrate exports to India will have a 12% drop in price competitiveness due to local tariff adjustments.
Trade agreements and regional cooperation:
The Regional Comprehensive Economic Partnership (RCEP) has significantly reduced the export cost of magnesium sulfate heptahydrate. For example, Shandong enterprises have enjoyed zero tariffs on products exported to Malaysia by voluntarily issuing RCEP declarations of origin. In 2023, the province's related exports enjoyed preferential value of 2.16 billion yuan. Similarly, the China-ASEAN Free Trade Agreement provides tariff advantages for the Southeast Asian agricultural market. In 2024, China's exports of agricultural products to ASEAN increased by 18% year-on-year.
Export controls and quotas:
China has implemented strict controls on magnesium mining and exports, including mining rights approval, paid bidding for export quotas, and restrictions on designated ports, resulting in fluctuations in the supply of raw materials. For example, in 2024, Yulin City, Shaanxi Province suspended some magnesium mining due to environmental protection rectification, causing an 8% increase in the price of magnesium sulfate heptahydrate raw materials, affecting the delivery of export orders.
2. Environmental protection and sustainable development policies
Carbon tariffs and carbon footprint requirements:
The EU carbon border adjustment mechanism requires imported products to declare carbon emissions during the production process. Although magnesium sulfate heptahydrate is not directly included, it may be indirectly affected as a raw material for fertilizer production. For example, if EU fertilizer companies need to purchase CBAM certificates, they may pass on the cost to upstream suppliers, resulting in an increase in the export price of magnesium sulfate heptahydrate.
Environmental regulations and circular economy:
The EU REACH regulation requires that chemicals with an annual import volume of more than 1 ton be registered and a chemical safety report be submitted. Companies must complete the registration through the only representative in the EU, and the compliance cost increases by about 15%. At the same time, countries have tightened their standards for industrial wastewater discharge.
3. Industry access and quality standards
Pharmaceutical and food regulatory certification:
Pharmaceutical grade magnesium sulfate heptahydrate must pass FDA, GMP, EP and other certifications. For example, Weifang Huakang Magnesium Sulfate Factory has passed FDA certification and EU REACH registration, and its products have a premium of 30% when entering the European and American pharmaceutical markets. Food-grade products must comply with the FSSC 22000 standard. For example, a company’s food additives exported to Japan were returned because the production line was not isolated from the industrial grade, resulting in a loss of about 2 million yuan.
Agricultural and industrial standards:
The EU CEN standard limits the calcium content of agricultural-grade magnesium sulfate heptahydrate to ≤0.02%, and Chinese companies need to meet the standard through ion exchange resin technology. In addition, China's "Limit Requirements for Toxic and Hazardous Substances in Fertilizers" (GB 38400-2019) stipulates the limits of heavy metals such as arsenic and cadmium. In 2024, a company's products exported to India were returned due to excessive arsenic content, resulting in a direct loss of 1.5 million yuan.
4. Agricultural and New Energy Industry Policies
Agricultural subsidies and soil improvement plans:
Agricultural policies of various countries directly stimulate demand. For example, the EU's organic agriculture support policy promotes the demand for ECOCERT-certified magnesium fertilizers, and the European organic magnesium fertilizer market size will reach US$420 million in 2024; China's "14th Five-Year Plan" soil improvement project will increase the demand for agricultural-grade magnesium sulfate heptahydrate by 8% annually, and domestic consumption will reach 1.78 million tons in 2024.
New energy and energy storage technology support: China's "14th Five-Year Plan" new materials industry plan includes battery-grade magnesium sulfate heptahydrate in the key auxiliary materials catalog, promoting companies such as CATL to purchase high-purity products, and the demand in the power battery field will reach 60,000 tons in 2024. At the same time, magnesium battery research and development has received policy support. The National People's Congress proposed to give magnesium battery companies "three exemptions and three reductions" income tax incentives. It is expected that the relevant demand will exceed 10,000 tons in 2025.
5. Domestic industrial policies and regional planning
Capacity regulation and technology upgrade: China implements a capacity replacement policy for high-energy-consuming industries. For example, Yulin City, Shaanxi Province requires lignite and metal magnesium companies to upgrade environmental protection equipment, resulting in a 10% increase in the cost of magnesium sulfate heptahydrate raw materials in 2024. At the same time, local governments promote technological innovation through subsidies.
Regional industrial clusters and export support: Shandong, Jiangsu and other major chemical provinces reduce costs through industrial clusters. In 2024, the two provinces account for 61.3% of the country's production capacity and 75% of the country's exports. Local governments also simplify export procedures through cross-border e-commerce comprehensive pilot zone policies.
6. Risks and Response Strategies
Policy risk hedging:
Enterprises need to diversify their raw material sources. For example, Qinghai Salt Lake companies use brine to extract lithium and produce magnesium sulfate as a byproduct, which reduces costs by 60% compared to traditional processes. At the same time, by hedging futures, sulfuric acid price fluctuations are locked in. In 2024, leading companies will control the impact of cost fluctuations within 3% through hedging.
Technology reserves and certification layout:
Pre-layout emerging market standards, such as India's BIS certification and Africa's COC certification. In 2024, a company obtained Nigeria's SONCAP certification in advance and seized 25% of the local agricultural market share. At the same time, research and develop sustained-release dosage forms to adapt to changes in medical policies. It is expected that the gross profit margin of related products will reach 45% after they are launched in 2026.