Raw material prices remain stable, while magnesium ingot prices rise slightly. The pattern of weak supply and demand continues [SMM Magnesium Morning Meeting Summary]

SMM Magnesium Morning Meeting Notes on July 7:

Magnesium Raw Materials

Prices

The ex-factory price (excluding tax) of 1-3 grade dolomite (Wutai) is 78 yuan/mt, and that of 2-4 grade dolomite (Wutai) is 128 yuan/mt. The mainstream ex-factory price of 75 ferrosilicon in Shaanxi ranges from 5,600 to 5,700 yuan/mt.

Supply and Demand

Recently, dolomite prices have remained stable. According to SMM, dolomite inventory in Wutai is sufficient, and manufacturers in other provinces are actively meeting the remaining demand for dolomite. It is expected that dolomite prices will remain stable in the future. Yesterday, the ferrosilicon futures market fluctuated, with the most-traded ferrosilicon 2509 futures contract closing at 5,364, down 6 yuan WoW. In the spot market, due to weak demand during the off-season, transactions in the ferrosilicon market have been sluggish. The market is waiting for the pricing of HBIS's July tender.

Magnesium Ingot

Prices

Today, the transaction price of magnesium ingot in Fugu ranges from 16,150 to 16,250 yuan/mt, up 50 yuan from the previous working day. The China FOB price remains unchanged at 2,210-2,310 US dollars/mt.

Supply and Demand

Currently, the magnesium ingot market continues to consolidate at low levels. The supply side maintains stable production, but the expected resumption of production in July brings potential pressure. On the demand side, domestic trade's just-in-time procurement support is limited, and foreign trade remains sluggish due to the European summer break and economic downturn. Traders are mostly purchasing as needed. The market as a whole maintains a weak supply and demand situation, with factories' reluctance to budge on prices and traders' cautious procurement continuing to compete. It is expected that the market will continue to consolidate weakly in the short term.

Magnesium Alloy

Prices

The mainstream tax-included ex-factory price of magnesium alloy in China ranges from 17,800 to 17,900 yuan/mt, and the mainstream FOB price of magnesium alloy in China ranges from 2,500 to 2,510 US dollars/mt.

Supply and Demand

Recently, magnesium alloy processing fees have remained stable at low levels. Moreover, the price spread between magnesium and aluminum has been maintained for a long time (the price spread between magnesium and aluminum was 4,570 yuan/mt last Friday), and the profit margin of magnesium-aluminum alloys such as AZ91D has been low for a long time. The negotiation space for magnesium alloy processing fees is limited. According to SMM, the reduction range for processing fees in the magnesium alloy market is 10 yuan.

Magnesium Powder

Prices

The mainstream tax-included ex-factory price of 20-80 mesh magnesium powder in China ranges from 17,450 to 17,650 yuan/mt, and the China FOB price ranges from 2,380 to 2,450 US dollars/mt.

Supply and Demand

Magnesium powder prices have remained stable overall, with continued support from raw material costs. The domestic market focuses on just-in-time procurement, with downstream enterprises being cautious about restocking. The overseas market has entered the traditional summer break cycle, with a significant decrease in inquiry activity and a sluggish trading atmosphere.