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This paper considers precoding schemes in physical network coded two-way MIMO relay channels. We propose a lattice reduction aided Tomlinson-Harashima Precoding(THP) scheme at first, and compare it with the existing amplify-and-forward (AF) scheme zero-forcing (ZF) schemes traditional decode-and-forward (DF) scheme and network coding (NC) scheme. Simulations show that the proposed scheme outperforms the existing schemes. This improvement is because we have combined the advantages of both THP and lattice reduction thus the effective transmitting power is significantly increased.