Cost-Driven Magnesium Market Refuses to Budge on Prices, Pre-Holiday Stockpiling Boosts Downstream Demand [SMM Magnesium Morning Meeting Minutes]

SMM Sep 17 Magnesium Morning Meeting Minutes:

Magnesium Raw Material

Prices

Ex-factory prices (ex-VAT) for 1-3 cm dolomite (Wutai) were 108 yuan/mt, up 30 yuan/mt MoM; 2-4 cm dolomite (Wutai) ex-factory prices (ex-VAT) were 128 yuan/mt, up 10 yuan/mt MoM; mainstream ex-factory prices for 75 ferrosilicon in Shaanxi were 5,800-5,900 yuan/mt.

Supply and Demand

Dolomite prices currently fluctuate upward. Magnesium plants in major producing areas are conducting routine stockpiling for normal production, with strong support from the demand side. Wutai dolomite quotations increased, awaiting downstream follow-up. Last week, the most-traded ferrosilicon futures contract 2509 closed at 5,700, up 40 or 0.71%. In the spot market, ferrosilicon producers maintained stable supply. Steel mills stocked up ahead of the National Day holiday, and ferrosilicon steel tenders performed well. Supported by demand, ferrosilicon prices held up well.

Magnesium Ingot

Prices

As of the previous working day, mainstream quotations for magnesium ingots in Fugu were 16,600-16,700 yuan/mt, down 50 yuan/mt from the previous working day; China FOB prices were $2,380-2,400/mt.

Supply and Demand

Market transactions performed well yesterday, with most transaction prices concentrated at 16,600 yuan/mt in the morning. In the afternoon, magnesium plants showed stronger reluctance to budge on prices, with some quotations rising to 16,700 yuan/mt and a small number of transactions concluded. Overseas orders also rebounded, mostly for immediate delivery. Affected by rising dolomite prices, magnesium plants are expected to continue holding firm on prices due to cost support, and market prices may maintain a stalemate with a strong bias.

Magnesium Alloy

Prices

As of the previous working day, mainstream VAT-included ex-factory prices for magnesium alloy in China were 18,300-18,450 yuan/mt; China FOB prices were $2,580-2,630/mt.

Supply and Demand

Magnesium alloy prices held firm yesterday. Driven by rising end-use demand, some magnesium alloy enterprises recently experienced tight spot supply and critically low inventories. Some alloy enterprises raised alloy processing fee quotations. However, downstream die-casting plants currently show strong fear of high prices, and high-priced transactions await further follow-through.

Magnesium Powder

Prices

As of the previous working day, mainstream VAT-included ex-factory prices for 20-80 mesh magnesium powder in China were 17,800-18,000 yuan/mt; China FOB prices were $2,530-2,570/mt.

Supply and Demand

Market activity for magnesium powder has increased significantly recently. As the National Day holiday approaches, downstream stocking demand has strengthened, and procurement enthusiasm in the domestic trade market is high. On the supply side, magnesium powder production has also increased to meet market demand. The price of magnesium powder is expected to remain stable in the future due to the influence of raw materials.