Chinalco Luoyang Successfully Produces First Magnesium Alloy Ingot, Boosting China's Aerospace Material Self-Reliance

[Rising magnesium ingot production costs push up prices, sluggish demand constrains rebound] Fugu magnesium ingot offers in both domestic and overseas markets rose along with higher costs, but end-use demand in China and outside China failed to follow through, limiting upward momentum. In the short term, magnesium ingot prices are expected to continue moving sideways within a range, with attention on downstream restocking and production cuts by producers.

【SMM Magnesium Flash】Recently, the Defense Industrial Base Alliance under the U.S. Department of Defense issued a special solicitation notice, openly soliciting key mineral investment plans from domestic producers, with a focus on filling the domestic production and supply gaps for four types of metals: indium, manganese, magnesium, and titanium. The deadline for submission of plans is September 17th. This solicitation covers the entire chain of mining, processing, refining, alloy smelting, and resource recovery, with all four types of metals listed in the U.S. critical minerals inventory. This move is expected to provide financial and policy support for the domestic production capacity construction of key defense materials such as magnesium and titanium.

[Costs Provide a Floor and Keep Magnesium Prices Firm; Domestic and Overseas Demand Limits Upside Room] Today, domestic offers for magnesium ingot in Fugu were 15,900-16,000 yuan/mt, and FOB offers were $2,250-$2,350/mt. Rising coal and ferrosilicon prices raised costs and kept prices firm. However, demand in China and overseas was weak, and overseas market gains were merely transmitted from the domestic market, leaving magnesium ingot in a tug-of-war between cost support and demand pressure.