[SMM announcement] from May 6, 2020, SMM will add "quotation for magnesium ingots (Fugu, Shenmu), magnesium powder (20-80 mesh), magnesium alloy AZ91D, magnesium alloy AM50, magnesium alloy AM60"

With the adjustment of magnesium ingot market in recent years, the main production areas of magnesium ingots in China have gradually transferred from Shanxi Province to Shaanxi Province. at present, the Fugu and Shenmu areas of Shaanxi Province have exceeded Shanxi Wenxi area to become the largest magnesium ingot production base in China. In 2019, the total production of magnesium ingots in this area accounts for more than 60% of the total amount of magnesium ingots in China, which has great influence on the magnesium ingot market in China. Magnesium powder (20-80 mesh) and magnesium alloy (AZ91D, AM50, AM60) are the main downstream products in magnesium ingot market. After SMM research, in order to serve the magnesium industry chain related enterprises, to provide them with a true reflection of the spot market prices, and continue to improve and deepen the magnesium industry chain research, will be officially issued on May 6, 2020 "Fugu, Shenmu", "magnesium powder (2080 mesh)", "magnesium alloy AZ91D", "magnesium alloy AM50", "magnesium alloy AM60" spot quotation.

Shanghai Nonferrous Network (hereinafter referred to as SMM) is a completely independent third-party service organization, does not participate in any substantive transactions, but as a market observer or organizer to maintain close communication with the buyer or seller of the transaction, and provide relevant services for the market. Through communication with the industry, SMM continues to develop, review and revise its methodology, adopting the most common product specifications, terms of trade and terms of trade in the industry, and paying equal attention to normal transactions that meet specifications and standards. SMM reserves the right to exclude any price information deemed to be less reliable or unrepresentative from its quotation judgment.

SMM publishes spot metal prices (or price indices, including China, non-China and global markets) on a daily basis, commonly referred to as SMM prices. SMM has formulated the corresponding methodology for the published SMM prices (all of which will be published on the official website of SMM www.smm.cn for inquiry). The methodology specifies the methods and procedures for the generation and release of SMM prices, and produces and publishes SMM prices in strict accordance with the provisions of the methodology.

In order to meet the actual situation of the spot market, SMM will make the necessary revisions to the SMM pricing methodology and announce it on the official SMM website before May 6, 2020. If you have any questions or suggestions about SMM pricing and its methodology, please contact SMM customer service personnel (please contact www.smm.cn on the official SMM website). This document sets out the spot price standards for magnesium ingots (Fugu, Shenmu), magnesium powder 20-80 mesh, magnesium alloy AZ91D, magnesium alloy AM50, magnesium alloy AM60, etc. The purpose of SMM is to establish a transparent and verifiable SMM price setting mechanism.

2.1 significance of quotation of SMM magnesium ingots (Fugu, Shenmu), magnesium powder (2080 mesh), magnesium alloy AZ91D, magnesium alloy AM50 and magnesium alloy AM60

With the adjustment of magnesium ingot market in recent years, the main production areas of magnesium ingots in China have gradually transferred from Shanxi Province to Shaanxi Province. At present, the Fugu and Shenmu areas of Shaanxi Province have exceeded Shanxi Wenxi area to become the largest magnesium ingot production base in China. In 2019, the total production of magnesium ingots in this area accounts for more than 60% of the total amount of magnesium ingots in China, which has great influence on the magnesium ingot market in China. Magnesium powder (20-80 mesh) and magnesium alloy (AZ91D, AM50, AM60) are the main downstream products in magnesium ingot market. After SMM research, in order to serve the magnesium industry chain related enterprises, to provide them with a true reflection of the spot market prices, and continue to improve and deepen the magnesium industry chain research, will be officially issued on May 6, 2020 "Fugu, Shenmu", "magnesium powder (2080 mesh)", "magnesium alloy AZ91D", "magnesium alloy AM50", "magnesium alloy AM60" spot quotation.

2.2 definition of price

The quotation of magnesium ingots (Fugu, Shenmu), magnesium powder (20-80 mesh), magnesium alloy AZ91D, magnesium alloy AM50 and magnesium alloy AM60 is the evaluation price produced and issued by SMM according to this methodology and can be used by both parties as a reference for spot trade settlement of magnesium ingots. This price reflects the self-raised price range of magnesium ingots (Fugu, Shenmu), 20-80 mesh magnesium powder, magnesium alloy AZ91D, magnesium alloy AM50 and magnesium alloy AM60 before the release time of the price of magnesium ingot (Fugu, Shenmu). At that time, SMM price members can query the historical price synchronously.

2.3 method of generating price

SMM obtains quotes for magnesium ingots (Fugu, Shenmu), magnesium powder (20-80 mesh), magnesium alloy AZ91D, magnesium alloy AM50 and magnesium alloy AM60 by means of standard. The daily designated price collector makes an inquiry to the bid acquisition unit, and the inquiry information is entered into the SMM internal system. The price is based on the spot transaction prices collected in the main market of magnesium ingots (Fugu, Shenmu), magnesium powder (20-80 mesh), magnesium alloy AZ91D, magnesium alloy AM50 and magnesium alloy AM60. The market transaction price, which is jointly confirmed by both buyers and sellers, must meet the requirements of fairness, tradability, replicability and so on. The standard collection price includes the actual spot transaction price provided by the local bid acquisition enterprise.

2.4 method of standard collection

According to the bid confirmation agreement, SMM will regularly collect price information from magnesium ingots (Fugu, Shenmu), magnesium powder (20-80 mesh), magnesium alloy AZ91D, magnesium alloy AM50 and magnesium alloy AM60 industry by telephone, WeChat, email, etc. The price information includes the price that has been completed, the expected most likely price to be completed by the enterprise, and so on. All instant messaging content, email communication content and any records of face-to-face communication will be archived. Details of the telephone communication will be recorded and recorded in the database. SMM analysts are subject to the Compliance regime when reporting to their executives any forced or threatened communication among market participants, or any induced offer that attempts to influence the assessment. After the price is released, SMM will not revise or adjust it on the same day.

2.5 Product Standard

Magnesium ingot: in line with the requirements of the national standard GB/T3499-2011 for all indexes of magnesium ingot, Mg ≥ 99.9%.

Magnesium powder (20-80 mesh): in line with the requirements of the national standard GB/T5149.1-2004 for magnesium powder (20-80 mesh), screen pore size range (- 850 μ m, + 180 μ m).

Magnesium alloys (AZ91D, AM50, AM60): meet the requirements of the national standard GB/T 25748-2010 for magnesium alloys (AZ91D, AM50, AM60), the domestic alloy code names are YM305, YM203, YM204.

2.6 unit of valuation

RMB / ton

2.7 forms of expression

Presented in interval form, including tax value (including 13% VAT)

2.8 release time

12: 00-13: 00 per working day (except statutory holidays and weekends in China)

2.9 quoting process

SMM carries out the quotation of magnesium ingots (Fugu, Shenmu), magnesium powder (20-80 mesh), magnesium alloy AZ91D, magnesium alloy AM50 and magnesium alloy AM60 each working day from 9: 30 to 13: 00. The specific process is as follows:

2.10 change in methodology

All markets are changing, and SMM has a responsibility to ensure that the methodology for market reporting changes synchronously with the market. As a result, SMM conducts regular internal reviews of the appropriateness of the methodology based on industry feedback. SMM will follow the formal external consultation process for all potential changes that are substantive and not urgent. It then announces major changes and gives a notice period of at least 28 days, inviting industry members to comment, unless special circumstances, especially force majeure (natural disasters, war, exchange bankruptcy, etc.) cause the notice period to be shortened. SMM promises to scrutinize all comments on the proposed methodological changes, but in some cases it may have to change the methodology against the wishes of some market participants. In addition, SMM has a formal methodological consultation process. SMM promised to hold a formal consultation on the methodology every three years. The date of the last consultation and the deadline for SMM's commitment to hold the next consultation are at the top of the methodology document.

Welcome more related enterprises in the industry chain to participate in and support SMM to better serve magnesium-related enterprises.

If in doubt, please call:

Shanghai Nonferrous Network magnesium Research team Lu Jiamin contact Information: 021-51666917