Raw Material Prices Stable, Magnesium Prices in the Doldrums [SMM Magnesium Morning Meeting Summary]

SMM Magnesium Morning Meeting Summary on August 26:

Magnesium raw material

prices

The ex-factory price (excluding tax) for 1-3 grade dolomite (Wutai) is 78 yuan/mt, and the ex-factory price (excluding tax) for 2-4 grade dolomite (Wutai) is 128 yuan/mt; in Shaanxi, the mainstream ex-factory price for 75 ferrosilicon is 5,800-5,900 yuan/mt.

Supply and demand

Currently, the price of dolomite is stable, with market supply remaining ample. On the demand side, as magnesium plants gradually resume production, procurement demand has shown an increasing trend, and it is expected that the price of dolomite will continue to be firm; yesterday, the most-traded silicon iron futures contract 2509 closed at 5,680, up 0.89%, or 50 yuan. In the spot market, the current silicon iron market shows a pattern of strong supply and weak demand, with a strong wait-and-see sentiment among downstream players, and market purchases mainly driven by restocking needs. In the short term, silicon iron prices are fluctuating rangebound.

Magnesium ingot

prices

As of the previous working day, the mainstream quotations for magnesium ingots in Fugu area were 17,200-17,300 yuan/mt, down 50 yuan from the previous working day; China's FOB price was $2,370-2,430/mt.

Supply and demand

Today, magnesium prices are in the doldrums, with the market in a tug-of-war between sellers and buyers. In terms of supply, last week, the production and inventory of mainstream magnesium plants both saw a slight increase; on the demand side, overseas inquiries are active but large orders are limited, and domestic downstream purchasing sentiment is weak, resulting in insufficient overall demand support. Current magnesium prices are under pressure and consolidating at a low level, with mainstream quotations fluctuating around 17,200 yuan/mt.

Magnesium alloy

prices

As of the previous working day, the mainstream ex-factory price (including tax) for Chinese magnesium alloys was 18,850-18,950 yuan/mt, and the mainstream FOB price for Chinese magnesium alloys was $2,570-2,650/mt.

Supply and demand

Yesterday, magnesium alloy prices were closely linked to upstream raw material prices, with their overall trend directly influenced by them. From a fundamental perspective, the demand side is steadily improving, and the processing fees for magnesium alloys are currently firm, with industry profitability temporarily stable. However, the high fluctuation of upstream magnesium ingot prices provides support, and the continuous consolidation of magnesium alloy spot prices at a high level has triggered strong resistance from downstream die-casting factories. In the short term, the current stable situation is likely to persist.

Magnesium powder

prices

As of the previous working day, the mainstream ex-factory price (including tax) for 20-80 mesh Chinese magnesium powder was 18,400-18,600 yuan/mt; the FOB price for China was $2,520-2,580/mt.

Supply and demand

Affected by the shutdown and maintenance of some steel mills at the end of August, downstream demand has been put on hold, leading to a delay in the procurement of raw materials by magnesium powder plants. The demand in the domestic trade market currently contracted, and most market participants adopted a wait-and-see attitude.