How to reduce lag
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First thing you can do to reduce the lag is going to 'Preferences' (CTRL+P). Then go to 'Graphics', lower 'Draw Distance' to 64 (minimum).
If that doesn't help much, go to 'Network' tab, then 'Clear Cache'. After Clearing your Cache, re-log (log out and log back in).
Of course you can also lower some graphic options like Shaders, depends on your graphic card.