Insufficient follow-up on transactions, magnesium ingot prices in the doldrums [SMM Magnesium Morning Meeting Summary]

SMM Magnesium Morning Meeting Summary on July 8:

Magnesium Raw Materials

Prices

The ex-factory price (tax not included) of dolomite (Wutai) for 1-3 material is 78 yuan/mt, and for 2-4 material is 128 yuan/mt. The mainstream ex-factory price of 75 ferrosilicon in Shaanxi is 5,600-5,700 yuan/mt.

Supply and Demand

Recently, the market price of dolomite has remained stable. In Wutai, the main producing area, inventory remains sufficient, while producers in other regions are meeting market demand gaps through flexible restocking. Considering the overall supply-demand balance, dolomite prices are likely to remain stable in the short term. Yesterday, the futures market for ferrosilicon saw a significant increase, with the most-traded ferrosilicon 2509 futures contract closing at 5,460, down 72 yuan from the previous working day. In the spot market, ferrosilicon resources are scarce, and market sentiment has improved somewhat. Ferrosilicon prices are expected to remain firm in the short term.

Magnesium Ingot

Prices

Today, the transaction price of magnesium ingot in Fugu area is 16,250-16,350 yuan/mt, down 50 yuan from the previous working day. The China FOB price is reported at 2,240-2,330 US dollars/mt.

Supply and Demand

Last week, magnesium prices showed a high consolidation trend. On the supply side, there were many reports of magnesium plant resumptions in the main producing areas this week. According to SMM, two magnesium plants produced magnesium ingot this week, and it is expected that another two magnesium plants will produce magnesium ingot next week, indicating an increasing trend in magnesium ingot supply. On the demand side, due to the approaching shipping period, foreign trade traders concentrated on purchasing magnesium ingot in the first half of this week, coupled with just-in-time procurement from domestic trade clients, magnesium ingot prices showed an upward trend. However, as the purchasing period passed, demand support weakened, and magnesium ingot prices once again showed a weak downward trend.

Magnesium Alloy

Prices

The mainstream tax-included ex-factory price of magnesium alloy in China is 17,900-18,000 yuan/mt, and the mainstream FOB price of magnesium alloy in China is 2,510-2,530 US dollars/mt.

Supply and Demand

Domestic magnesium alloy prices have followed the downward trend of magnesium ingot prices. On the supply side, production has slightly contracted due to producer production cuts. On the demand side, it remains weak due to the overseas order window period and the domestic die-casting off-season. The market shows a weak supply-demand balance, and magnesium alloy prices are expected to fluctuate rangebound in the short term.

Magnesium Powder

Prices

The mainstream tax-included ex-factory price of 20-80 mesh magnesium powder in China is 17,550-17,750 yuan/mt, and the China FOB price is 2,410-2,460 US dollars/mt.

Supply and Demand

Magnesium powder prices have shown a downward trend due to the decrease in raw material prices. Currently, the market shows a weak supply-demand balance, with producers maintaining production and low inventory levels, and cautious procurement on the demand side. There is a strong wait-and-see sentiment among upstream and downstream participants, and a weak balance is expected to continue in the short term.