The Magnesium Market Is Under Pressure Across the Board, with Tightening Raw Material Supply and Sluggish Demand Interwoven [SMM Magnesium Morning Meeting Minutes]

Published: Feb 4, 2026 09:25

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[SMM Magnesium Morning Conference Notes: Magnesium Market Under Pressure Amid Tight Raw Material Supply and Sluggish Demand] February 4, cost side, dolomite supply tightened as leading producers in Wutai suspended production, with prices expected to hold up well; ferrosilicon futures dropped slightly, while spot transactions remained neutral, with downstream users mainly making just-in-time procurement. The magnesium ingot market continued its weakness, with offers in Fugu County lowered to 16,400-16,500 yuan/mt, sluggish transactions, and strong wait-and-see sentiment among downstream users. Foreign trade was mainly focused on fulfilling previous orders, with few new orders. The benchmark price of magnesium alloy was under pressure due to declining magnesium ingot prices on the cost side, but processing fees held steady. As the Chinese New Year approached, some end-users began holidays, leading to a slight decrease in orders, with the market maintaining a tight balance. The magnesium powder market remained generally stable, though the center shifted slightly downward due to falling raw material prices. On the demand side, domestic trade involved purchasing as needed, while foreign trade saw limited new orders. Overall, the magnesium industry chain faced partial supply tightness providing support in the short term, but sluggish demand remained the core factor driving price trends, with the market expected to stay in the doldrums.

SMM February 4 Magnesium Morning Meeting Minutes:

Magnesium Raw Materials

Prices

The ex-factory price, excluding tax, for 1-3 cm dolomite (Wutai) was 108 yuan/mt, flat from the previous working day; the ex-factory price, excluding tax, for 2-4 cm dolomite (Wutai) was 128 yuan/mt, flat from the previous working day; the mainstream ex-factory price for 75 ferrosilicon in Shaanxi was 5,850 yuan/mt.

Supply and Demand

Wutai dolomite prices held steady yesterday. Recently, leading dolomite producers in Wutai confirmed production halts, reducing the supply of high-quality dolomite in the market. Considering the current high operating rates of primary magnesium producers, which provide strong support for dolomite demand, dolomite prices are expected to hold up well. In the previous working day, the most-traded ferrosilicon futures contract, 2603, closed at 5,620 yuan, down 40 yuan. In the spot market, ferrosilicon enterprises maintained normal production schedules, downstream users continued just-in-time procurement, traders operated cautiously, and market activity remained at a neutral level. Future price trends will depend on the next round of steel mill pricing.

Magnesium Ingot

Prices

Today, the mainstream transaction price for magnesium ingot in the Fugu area was 16,400-16,500 yuan/mt, down 150 yuan/mt from the previous working day; the Chinese FOB price was $2,330-2,390/mt.

Supply and Demand

The magnesium market remained in the doldrums yesterday, with mainstream transaction prices concentrated around 16,400 yuan/mt. According to an SMM survey, some small factories offered futures prices around 16,200 yuan/mt, and some magnesium powder plants made purchases around 16,300 yuan/mt. Overall market transactions were sluggish, with downstream users generally adopting a wait-and-see attitude. On the export front, delivery was mainly focused on previous orders, with few new orders signed. Market attention is largely concentrated on Q2 order negotiations. Overall, the magnesium market is expected to remain weak this week.

Magnesium Alloy

Prices

Today, the mainstream tax-included ex-factory price for magnesium alloy in China was 18,650-18,850 yuan/mt; the Chinese FOB price for magnesium alloy was $2,630-2,660/mt.

Supply and Demand

Yesterday, the magnesium alloy market saw the benchmark price under pressure while processing fees held steady. On the cost side, the transaction center for magnesium ingot shifted downward, and the benchmark price declined. In auxiliary materials, the price of A00 aluminum ingot fell from high levels, narrowing magnesium alloy processing costs. However, magnesium alloy producers mainly adopted a wait-and-see stance, and processing fees remained stable. Supply and demand side, magnesium alloy producers operated stably. As the year-end approached, some die-casting plants and end-users were nearing the Chinese New Year break, leading to a slight decrease in orders. Overall, the magnesium alloy market maintained a tight balance, with alloy processing fees holding firm.

Magnesium Powder

Price

Today, the mainstream tax-inclusive ex-factory price for 20-80 mesh Chinese magnesium powder was 17,600-17,800 yuan/mt; the FOB China price was $2,490-2,550/mt.

Supply-Demand

The magnesium powder market remained generally stable yesterday, but the price center edged down due to lower raw material costs. On the supply side, some enterprises entered the market to purchase magnesium ingots to replenish raw material inventory. Demand side performance remained mediocre, with domestic trade maintaining a purchasing-as-needed pace, and new order bookings in the foreign trade sector were also relatively limited.

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM‘s internal database model. They are for reference only and do not constitute decision-making recommendations.

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