In the second week of May, mainly driven by the sustained surge in the coal market, superimposed ferrosilicon prices rose. The magnesium market continued to soar in the previous four days and stabilized on Friday. To May 14, 99.9% of magnesium ingots in Fugu area reported mainstream ex-factory cash prices of 22000 yuan / ton including tax. Last week, transaction prices rose as high as 21500-21800 yuan / ton, and 21700-22200 yuan / ton in Wenxi area. At this point, after the May Day International Labour Day, magnesium prices soared into the sky, rising about 4500 yuan / ton, showing signs of stabilization last Friday.
It is also understood that as magnesium prices continue to rise, the fear of heights among downstream users and traders gradually increases. The superimposed surging coal prices, which have touched the red area, attracted the attention of the government last week, and the risk aversion and fear of heights in the coal market increased. Trading in the magnesium market slowed down last Friday, and prices stabilized.
On May 14, the author learned from a market person that the magnesium market is running smoothly, trading has slowed down, and the downstream has turned to wait-and-see market. This person believes that the magnesium market may stabilize in the short term.
Last week, a manager of a magnesium powder factory told me that the recent crazy rise in the upstream raw material market and the great pressure on downstream enterprises made it difficult for foreign customers to accept high prices, and they mainly purchased a small amount of goods on demand. It is also understood that due to the recent sharp rise in magnesium prices, many processing enterprises and traders have low pre-signing prices and are unable to pay the documents, so they can only stop work or destroy the orders, resulting in a lot of damage in the market.
The analysis shows that, from the point of view of the relationship between supply and demand, in view of the recent rapid rise in magnesium prices, difficulties in acceptance downstream, slow procurement, high-level operation of the magnesium market under pressure. Considering that there is not much spot in the factory at present, the superimposed coal price and ferrosilicon price are still high, supported by cost, it is expected that the downward space of magnesium price will also be limited, wait and see the future coal market progress and downstream procurement status.
According to the analysis, from the point of view of the relationship between supply and demand, in view of the current rising trend of coal prices is still strong, some institutions predict that this round of spot coal prices are expected to exceed 1000 yuan / ton by the end of May. Affected by this, the spot of stacking plants is generally tight, and it is expected that the magnesium market will still be strong and good in the short term. Taking into account the recent rapid rise in magnesium prices, it is difficult to accept downstream, wait and see the majority of the market, the late magnesium price rise is expected to slow down.
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