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Show The outlook for global use of magnesium diecastings in automotive applications is expected to continue to grow at 15- 20 percent average annual growth rate. North America and Europe are expected to be the areas with largest growth. Although magnesium prices declined in 1996 through June 1997, they began to increase slowly from mid- year. Price fluctuations were not as widely varied as in recent history. From 1993 to 1995, prices fluctuated from $ 2,260 to $ 4,138 per metric ton ( Kramer, 1998a). U. S. production of magnesium compounds increased in 1996. Magnesium chloride was used mainly as a chemical intermediate. Magnesium chloride brines were used principally for road dust and ice control. MgCl2 was used in agricultural, chemical, construction, environmental and industrial applications. Year- end magnesium compound prices in 1996 did not change from those at year- end 1995 ( Kramer, 1998b). The term potash denotes a variety of mined and manufactured salts, all containing the element potassium in water soluble form. The general term potash also includes potassium sulfate ( K2S04), which is produced in Utah ( Searls, 1998 and Trimmer, 1998). Domestic potash production comes from New Mexico, Utah and California. Because it is a source of soluble potassium, potash is used primarily as an agricultural fertilizer. U. S. potash sales were approximately 88 percent to the fertilizer industry and approximately 12 percent to the chemical industry. Production of all types and grades of potash in the U. S. declined in 1996. Sales of all types and grades of U. S.- produced potash were unchanged from 1995 to 1996. Potash consumption was only slightly above the 1995 level in 1996 ( Searls, 1998). Royalties on State Minerals Prior to February 1997, Cargill and Morton paid a $ 0.10 per ton royalty to DFFSL on salt extraction, while IMC's predecessor paid an ad valorem royalty of approximately 2 percent of the value of the salt. Currently, Cargill and Morton pay a $ 0.10 per ton royalty to DFFSL, with an additional amount paid into an escrow account which is controlled by the companies. DFFSL, which administers mineral leasing on GSL, has adjusted the royalty rate to $ 0.50 per ton to be implemented over the next five to eight years. DFFSL reached a settlement with Morton Salt for a buyout of its outdated royalty agreement. This action is being contested by other mineral companies ( Trimmer, 1998). / IMC Kalium Ogden Corp. pays an ad valorem royalty rate of 1.5- 5 percent, increasing over time, on magnesium chloride and potassium sulfate. Magcorp pays a royalty rate of 0.1259- 0.41967 percent, increasing over time, on sales of magnesium metal and chlorine gas. In 1986, these companies were allowed to roll- back the royalty rate to year one due to flood damage. The royalty rate has continued to advance from this base rate since that time. North Shore Limited pays a royalty of 5 percent on the value of the brine with a $ 5,000 minimum royalty ( Trimmer, 1998). All of the above- listed royalties are put into the restricted Sovereign Lands Management Account. This money must be appropriated by the Legislature for any use. To date, these funds have been used for DFFSL's operating costs associated with sovereign lands 125 |