[note] some magnesium factories in Shaanxi plan to reduce production by 35%. Short-term magnesium prices are expected to remain strong.

SMM12 March 28: it is reported that some magnesium factories in Shaanxi Province are planning to reduce the production of Lanchan carbon and magnesium ingot Synchronize by 35% because of environmental protection and high coal prices. It is reported that according to the "Emergency notice on the decisive Battle of the Blue Sky Defense Battle in the whole Province" (Shaanxi Government Office (2020) No. 35). The document calls for a province-wide "14-day decisive battle to win 41 micrograms of blue sky defense operations" from December 19 to 31. It is required that during this emergency response period, the combustion of bulk coal and biomass, the transportation of high-emission vehicles and earthwork should be strictly prohibited, and the measures of stopping production and off-peak production should be strictly implemented to minimize the intensity of pollution emission.

Affected by this, the trading price of magnesium showed a trend from weak to strong last week. At present, magnesium factory inventory is released in an orderly manner, trading volume continues to improve, downstream early stock of low-priced raw materials is less, facing replenishment demand. Magnesium prices are expected to remain strong in the short term.

On the supply side, coal prices continue to rise, Fugu area is ready for production and sales, coal carts are not reduced, and the mine is low in inventory.

Demand side recently maintained weak operation, a trader account manager said that the epidemic abroad is more serious, recent orders have not significantly improved.

[SMM magnesium spot Weekly Review] Environmental production restrictions break the deadlock, magnesium prices continue to strengthen (2020.12.21-2020.12.25)