Magnesium prices rise slightly, with strong market demand for magnesium powder [SMM Magnesium Morning Meeting Summary]

SMM August 8 Magnesium Morning Meeting Minutes:

Magnesium raw material

prices

for 1-3 grade dolomite (Wutai) ex-factory prices excluding tax stood at 78 yuan/mt, while 2-4 grade dolomite (Wutai) ex-factory prices excluding tax were 128 yuan/mt. In Shaanxi, the mainstream ex-factory price for 75 ferrosilicon ranged between 5,800-5,900 yuan/mt.

Supply and demand

Dolomite prices remained stable yesterday with ample market supply. However, demand increased as magnesium plants resumed production, and prices are expected to remain firm going forward. The most-traded ferrosilicon futures contract 2509 closed at 5,834 yuan yesterday, down 72 yuan or 1.22%. In the spot market, ferrosilicon producers faced tight spot supply, providing strong support at the price bottom. Given that demand recovery still requires time, prices are likely to fluctuate rangebound in the near term.

Magnesium ingot

prices

As of the previous working day, mainstream quotations in Fugu held steady at 17,250 yuan/mt, up 150 yuan/mt from the prior session. China's FOB price was quoted at $2,340-2,440/mt.

Supply and demand

Mainstream transaction prices for magnesium ingots in Fugu stabilized at 17,200 yuan/mt yesterday, with trading volume rebounding slightly. Supported by the digestion of previous futures orders and low inventory, magnesium producers maintained strong reluctance to budge on prices. Downstream magnesium powder demand performed notably well, reinforcing market bottom support. Overseas, downstream buyers grew more cautious, showing weaker order placement willingness. The mainstream FOB quotation range narrowed slightly to $2,380-2,390/mt, with a clear tug-of-war between sellers and buyers.

Magnesium alloy

prices

As of the previous working day, China's mainstream tax-inclusive ex-factory prices for magnesium alloy were 18,850-18,950 yuan/mt, while the mainstream FOB price stood at $2,580-2,660/mt.

Supply and demand

Magnesium ingot prices rose slightly yesterday, driving parallel movements in magnesium alloy prices. However, intense "rat race" competition in the magnesium alloy market has kept processing fees rangebound at low levels for an extended period. An alloy enterprise executive noted that the aluminum-magnesium price spread has remained inverted long-term, especially for AZ91D alloy with higher aluminum content, pushing costs near breakeven. With strong bottom support, magnesium alloy prices are expected to stay firm.

Magnesium powder

prices

As of the previous working day, mainstream tax-inclusive ex-factory prices for 20-80 mesh Chinese magnesium powder were 18,400-18,600 yuan/mt, with FOB prices at $2,510-2,580/mt.

Supply and demand

Yesterday, supported by the prices of raw materials, the magnesium powder market fluctuated at highs. The downstream transaction volume increased significantly, driving magnesium powder enterprises to increase their procurement of magnesium ingots. Overall demand was strong.