Magnesium producers show flexibility in pricing with low-priced supplies available, magnesium prices in the doldrums [SMM Magnesium Morning Meeting Minutes]

SMM September 30 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 6,050-6,150 yuan/mt.

Supply and Demand

Domestic dolomite market prices held steady yesterday. Supply and demand sides worked in synergy, providing strong support for the market. Magnesium producers in the main production areas maintained stable production operations, with sustained release of rigid demand for dolomite forming robust support. Dolomite prices are expected to continue holding up well. For ferrosilicon, the most-traded contract fer2509 futures closed at 5,610 yesterday, down 70 or 1.23%. In the spot market, producers are currently operating according to production plans. On the demand side, pre-holiday stockpiling for the National Day was largely completed, leaving insufficient demand support currently. Pressure from inventory buildup after the holiday exists. Ferrosilicon prices are expected to operate under pressure subsequently.

Magnesium Ingot

As of the previous working day, mainstream quotations for magnesium ingots in the Fugu area were 16,550-16,650 yuan/mt, down 50 yuan from the previous working day; the Chinese FOB price was $2,400-2,440/mt.

Supply and Demand

Magnesium prices remained under pressure today, with sluggish market transactions leading to a slight increase in magnesium producers' inventory. In this context, some producers' reluctance to budge on prices showed signs of loosening, with low-priced spot cargo appearing in the market this morning. Transaction prices ranged from 16,600-16,500 yuan/mt, yet downstream purchasing interest was low, resulting in overall sluggish market activity. On the supply side, magnesium producers maintained normal production according to plans. On the demand side, domestic trade enterprises such as aluminum plants and alloy plants conducted necessary restocking, but overall transactions were scattered, failing to form concentrated purchasing power, leading to insufficient support for magnesium prices. Overall, magnesium prices are expected to remain in the doldrums in the short term.

Magnesium Alloy

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

Supply and Demand

The domestic magnesium alloy market held up well recently, with demand growth pushing most magnesium alloy producers into spot inventory inversion. Most producers are operating on order backlogs, with some increasing processing fees. On the supply side, although some alloy producers actively raised operating rates to increase magnesium ingot supply in an attempt to ease supply-demand pressure, the current undersupply market structure has not fundamentally changed and is difficult to reverse in the short term. Overall, the domestic magnesium alloy market is expected to continue its strong performance in the short term.

Magnesium Powder

Prices

As of the previous working day, the mainstream ex-factory prices, inclusive of tax, for 20-80 mesh Chinese magnesium powder were 17,750-17,950 yuan/mt; the Chinese FOB price was $2,550-2,600/mt.

Supply and Demand

Recently, raw material procurement activity in the magnesium powder market has increased significantly, primarily driven by both pre-National Day concentrated stockpiling and the pullback in magnesium ingot prices. Downstream enterprises actively increased their purchasing efforts to secure low-cost raw material windows while also actively preparing for both domestic and international trade orders. Consequently, magnesium powder production has steadily risen, overall demand has remained stable, and the market exhibits a short-term pattern of robust supply and demand. Supported by cost factors and pre-holiday stockpiling, magnesium powder prices are expected to maintain their firm trend.