Raw material cost support remains solid, with downstream players awaiting demand growth in a wait-and-see stance [SMM Magnesium Morning Meeting Minutes]

SMM September 25 Magnesium Morning Meeting Minutes:

Magnesium Raw Material

Prices

The ex-factory price, excluding tax, for 1-3 cm dolomite (Wutai) was 108 yuan/mt, flat from the previous working day; the ex-factory price, excluding tax, for 2-4 cm dolomite (Wutai) was 128 yuan/mt, flat from the previous working day; the mainstream ex-factory price for 75 ferrosilicon in Shaanxi was 5,900 yuan/mt.

Supply and Demand

Domestic dolomite market prices held steady yesterday. Both supply and demand sides provided strong support for the market. Magnesium producers in the main production areas maintained stable production, continuously releasing rigid demand for dolomite, which formed robust support. Dolomite prices are expected to continue holding up well. The most-traded ferrosilicon futures contract, fer2509, closed at 5,742 yesterday, up 50 points, a gain of 0.88%. In the spot market, ferrosilicon producers showed strong reluctance to budge on prices, while downstream demand was relatively weak, resulting in a sluggish trading atmosphere. Considering the significant cost support, ferrosilicon prices are expected to hold steady in the short term.

Magnesium Ingot

Prices

As of the previous working day, mainstream quotations for magnesium ingot in the Fugu area were 16,650-16,750 yuan/mt, flat from the previous working day; the Chinese FOB price was $2,390-2,440/mt.

Supply and Demand

Magnesium producers maintained firm offers yesterday, with mainstream prices holding at 16,700 yuan/mt, but actual market transaction volume was limited. Some producers completed small shipments at 16,650 yuan/mt and subsequently showed strong reluctance to budge on prices. In the domestic market, recent demand orders were generally stable but with limited incremental growth. In the export market, traders' purchase willingness was generally weak, with most focusing on executing previous shipping orders. Currently, downstream sectors have only released a small number of new orders for October, and the overall market wait-and-see sentiment remains strong.

Magnesium Alloy

Prices

As of the previous working day, the mainstream tax-included ex-factory price for magnesium alloy in China was 18,350-18,500 yuan/mt; the Chinese FOB price for magnesium alloy was $2,590-2,630/mt.

Supply and Demand

Domestic magnesium alloy market prices held steady yesterday. On the supply side, spot supply was tight for some alloy enterprises, and with adjustments to the production pace, the industry operating rate is expected to increase. On the demand side, the approaching September-October peak season is driving a recovery in downstream demand, and market procurement activity is expected to improve. Overall, magnesium alloy market prices are likely to maintain an upward fluctuation pattern in the short term.

Magnesium Powder

Prices

As of the previous working day, the mainstream tax-included ex-factory price for 20-80 mesh magnesium powder in China was 17,900-18,100 yuan/mt; the Chinese FOB price was $2,540-2,580/mt.

Supply-Demand

The magnesium powder market is exhibiting a weak supply-demand balance. As the holiday period approaches, the restocking process by end-users has largely concluded, and market purchasing activity is gradually declining. International market demand lacks momentum, with few new foreign trade orders emerging, and buyers are generally maintaining a cautious, wait-and-see stance. Production operations remain stable, with enterprise operating rates sustained at normal levels. Against a backdrop of intertwined bullish and bearish factors, magnesium powder prices are expected to continue fluctuating rangebound in the near term.