High position and strong Operation of magnesium Price rising Market-- Review and Prospect of magnesium Market in April

Review and Forecast of Market Price trend

Review of domestic Price trend

In April, the daily average price of magnesium in China fluctuated between 15400 yuan and 17600 yuan per ton, with an average monthly price of 16327.78 yuan per ton, an increase of 22.42 percent over the same period last year. At the beginning of April, magnesium prices rose slightly, coal prices remained high, continued to strongly support the original magnesium cost end, the factory had no inventory pressure, and there was always strong quotation, while downstream customers were active in purchasing, and the market trading volume increased, which greatly boosted market confidence. in early April, the main producing areas quoted 15400-15800 yuan per ton, and in the middle of April, the operation of the magnesium market tended to be stable. With the completion of the procurement, the downstream customers gradually returned to the wait-and-see situation, and the factory was affected by the cost, and the quotation continued to be strong. Although the downstream purchase volume has been reduced, there is not much spot in the market as a whole, and the inventory in some factories is tight. Magnesium prices have risen slightly in a stable state. The quotation in the main producing areas is 15600-16000 yuan / ton. In late April, the magnesium market broke the steady trend and began to rise strongly. Especially in Europe, large orders have been released one after another. at the same time, under the influence of tight shipping dates and positions, traders rushed into the market to rush for goods, the price of coal at the end of raw materials hit new highs again, and the magnesium market went up, and the price returned to 16000 yuan / ton. and approaching 17000 yuan / ton, approaching the "May Day", magnesium prices broke out again, downstream customers affected by the mentality of buying up but not buying, continuous inquiry procurement, the market is extremely active. The factories in the main producing areas are in short supply, need more orders for production, the quotation is constantly rising, and the magnesium market is running strongly at a high level.

By the end of April, the mainstream quotations of manufacturers in Shanxi, Ningxia and Shaanxi were 17500-17600 yuan / ton, 17300-17400 yuan / ton and 17300-17400 yuan / ton respectively.

On the export side, FOB prices rose sharply in April compared with the previous period. In April, FOB prices averaged US $2600.56 per ton, an increase of 31.72% over the same period last year. The average price from January to April was 2461.61 US dollars per ton, an increase of 17.55 percent over the same period last year.

By the end of April, the export quotations of some manufacturers and traders ranged from US $2790 to US $2800 per ton of FOB.

Review of the Price trend of International magnesium Market

American market

In April, the price of magnesium in the US market fell slightly.

According to the report of American Metal Weekly, in April, the western spot price of US magnesium ingot remained stable at US $2.30 ~ US $2.35 / lb; the import price of US magnesium ingot traders dropped from US $2.02 ~ US $2.12 / lb to US $2.00-US $2.05 / lb. The price of US die-casting alloy (trader) is stable at US $1.80-US $1.90 / lb.

European market

Prices related to the European market rose sharply in April.

The British Metal Guide reported that the price of (MB) magnesium ingots rose from $2600 ~ $2700 / ton at the beginning of April to $2650 ~ $2775 / ton at the end of April; the European free market price of (MW), an American metal weekly, rose from $2600 ~ $2700 / ton at the beginning of April to $2625 ~ $2750 / ton, and then to $2700 ~ $2800 / tonne. At the end of April, the price rose sharply again, closing at $2875 ~ $3025 / ton. European strategic small metal Rotterdam warehouse quotation rose from 2510 US dollars / ton to 2575 US dollars / ton.

Outlook for the future

In April, coal prices in Shenfu area of Shaanxi Province rose sharply, and the coal prices of some coal mines were even higher than those of Lanchan carbon, which led to the upside-down price of Lanchan carbon. Lanchan carbon enterprises lost a lot of money and had to reduce production or stop production for overhauling. The production reduction of Lanchan carbon once restricted the original magnesium production, resulting in low productivity of magnesium enterprises in the main producing areas, tight enterprise inventory, insufficient spot in the market, and there was still room for raw material prices to rise, which strongly supported magnesium prices. There is no supply of goods at low prices in the market. On the demand side, in addition to rigid demand, middlemen and traders are relatively cautious in entering the market, and the market is temporarily in a high and stable state. It is expected that the probability of subsequent coal price reduction is small, and the output of raw magnesium will still be restricted. While some downstream users will enter the market to purchase and replenish goods with the consumption of raw materials inventory, at the same time, foreign demand will also pick up. Overall market confidence will further improve, once there is a large order purchase, magnesium prices may appear a new round of rise, but do not rule out that the market demand does not increase significantly or only rigid demand, in this case, magnesium prices or timely pullback at high levels, the magnesium market will continue to rise in May, magnesium prices may be high.

Supply side

According to the preliminary statistics of China Nonferrous Metals Industry Association, from January to March, China produced 217900 tons of raw magnesium, an increase of 17.12% over the same period last year. Among them, Shaanxi produced a total of 146900 tons, an increase of 19.69 percent over the same period last year, while Shanxi produced a cumulative production of 28500 tons, an increase of 6.91 percent over the same period last year.

On the export side

According to statistics from the General Administration of Customs, from January to March, China exported a total of 117600 tons of magnesium products, down 5.39% from the same period last year, with a cumulative amount of US $312 million, an increase of 5.65% over the same period last year. Of this total, magnesium ingots exported 59600 tons, down 7.74 percent from the same period last year; magnesium alloy exports totaled 36900 tons, down 1.07 percent from the same period last year; and magnesium powder exports totaled 18000 tons, down 7.69 percent from the same period last year.

Related industries

Ferrosilicon market

In the ferrosilicon market, in the middle and first ten days of April, due to the delay in steel recruitment, there was a lack of confidence in the ferrosilicon market, while there was news from enterprises in Ningxia and Inner Mongolia that they were put into production and resumed production. The market supply was sufficient, and the actual demand of users did not increase significantly. The demand for ferrosilicon in the market was general, and the price of ferrosilicon decreased slightly. By mid-to-late April, the price of futures contracts increased greatly, and the market began to develop for the better. Ferrosilicon prices have started an upward mode, and are expected to rise further as a new round of steel moves begins in May.

Downstream market

According to the latest report released by the China things Union Steel Logistics Professional Committee, in April, the PMI index of the domestic iron and steel industry was 45.4%, down 2.5% from the previous month. The sub-index shows that the growth rate of steel mills taking orders has slowed, steel production has fallen somewhat, inventories have continued to decline as a whole, and raw material prices have rebounded quickly in the short term. The report predicts that demand in the domestic market will continue to slow in May, production tends to decline, the import and export pattern has changed, and iron ore prices may fall high. The report points out that in April, due to higher steel prices, the wait-and-see mood in the downstream industry increased, which had a certain impact on steel trading demand. The growth rate of steel orders slowed down, with the new order index of 44.4%, down 2.7 percentage points from the previous month.

In terms of the sponge titanium market, in April, the sponge titanium market operated relatively smoothly, and the price of sponge titanium in Shanghai was 68000 yuan / ton. at this stage, the military market demand is strong, the procurement quantity is growing, and the civil titanium material quantity is also relatively stable. the overall market demand is exuberant, and the inventory of manufacturers is tight, and it is expected that it will continue to rise in the future.

In terms of the aluminum market, according to relevant statistics, in April, China's electrolytic aluminum output was 6.106 million tons, an increase of 136000 tons over the same period last year, with an average daily output of 203500 tons. As aluminum prices are rising, aluminum plants are producing at full capacity, and the production capacity of enterprises that have been put back into production has been released. It is expected that more new capacity will be put in later, as well as the release of some production. At the same time, due to the rise in macroeconomic and overall prices of non-ferrous metal fundamentals, it is expected that the aluminum market will continue to operate at a high level in the later period.