Cost support is significant, and magnesium prices have risen slightly [SMM Magnesium Morning Meeting Summary]

SMM Magnesium Morning Meeting Summary on August 7:

Magnesium raw material

prices

The ex-factory price (tax not included) 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 the Shaanxi market ranges from 5,800 to 5,900 yuan/mt.

Supply and demand

Yesterday, dolomite prices remained stable, with sufficient market supply. However, demand increased as magnesium plants resumed production, and it is expected that prices will remain firm in the future. Yesterday, the most-traded ferrosilicon futures contract 2509 closed at 5,908, up 4.27% or 424 yuan. In the spot market, the previous price increase drove a rebound in the profit margins of ferrosilicon manufacturers, stimulating production growth. Meanwhile, as the impact of the off-season gradually faded, market demand also recovered synchronously, and manufacturers' enthusiasm for restocking based on rigid demand increased. Currently, the ferrosilicon market is showing a trend of increased supply and demand. Overall, it is expected that prices will fluctuate rangebound in the future.

Magnesium ingot

prices

As of the last working day, the mainstream quotation of magnesium ingots in the Fugu area remained at 17,200 yuan/mt, up 100 yuan/mt from the previous working day. The China FOB price is reported at 2,340-2,440 US dollars/mt.

Supply and demand

Judging from yesterday's magnesium market transactions, significant transactions were made at 17,100 yuan/mt in the morning, with all magnesium plants achieving transactions at this price. There was a shortage of supply at this price, indicating strong bottom support. However, the number of high-price transactions in the main producing areas was limited, with the highest transaction reaching 17,200 yuan/mt. Downstream follow-up was significantly difficult, and market trading sentiment was weak. Overall, the magnesium market is showing a pattern of weak supply and demand, and it is expected that magnesium prices will remain high and consolidate in the future.

Magnesium alloy

prices

As of the last working day, the mainstream tax-included ex-factory price of magnesium alloy in China ranges from 18,700 to 18,800 yuan/mt, and the mainstream FOB price of magnesium alloy in China is 2,580-2,660 US dollars/mt.

Supply and demand

Yesterday, magnesium ingot prices rose slightly, and magnesium alloy prices followed the fluctuations in raw material prices. However, due to severe "rat race" competition in the magnesium alloy market, alloy processing fees have been consolidating at low levels for a long time. A responsible person from an alloy company stated that the price spread between magnesium and aluminum has been inverted for a long time, and magnesium alloy processing fees are currently fluctuating near the cost line, with strong bottom support. Overall, it is expected that magnesium alloy prices will remain firm in the future.

Magnesium powder

prices

As of the last working day, the mainstream tax-included ex-factory price of 20-80 mesh magnesium powder in China ranges from 18,250 to 18,450 yuan/mt, and the China FOB price is 2,510-2,580 US dollars/mt.

Supply and demand

Currently, the magnesium powder market is supported by the high prices of magnesium ingots, with prices maintaining a strong consolidation. Downstream purchase willingness is insufficient, and market trading is sluggish. Buyers and sellers continue to engage in a game of negotiation.