Raw Material Prices Remain Firm, Magnesium Ingots and Processed Products Operate Under Pressure [SMM Magnesium Morning Meeting Minutes]

SMM October 31 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 price for 2-4 cm dolomite (Wutai) was 128 yuan/mt, also flat. In Shaanxi, the mainstream ex-factory price for 75 ferrosilicon was 5,700-5,900 yuan/mt.

Supply and Demand

Recently, domestic dolomite market prices held steady. Supply and demand sides worked in synergy, providing strong support for the market. Magnesium plants in main production areas maintained stable production, continuously releasing rigid demand for dolomite, forming robust support. Dolomite prices were expected to hold up well. For ferrosilicon, the most-traded contract fer2509 closed at 5,550 yuan/mt on the previous working day, down 26 yuan or 0.47%. In the spot market, leading ferrosilicon producers conducted equipment maintenance, suggesting a slight future supply decrease. Supported by current costs, some producers raised ferrosilicon prices, leading prices to hold up well.

Magnesium Ingot

Prices

Today, mainstream quotations for magnesium ingot in Fugu were 16,050-16,150 yuan/mt, down 50 yuan from the previous working day. The Chinese FOB price was $2,270-2,340/mt.

Supply and Demand

As magnesium prices trended downward unilaterally, the trading center gradually shifted lower. Yesterday's market transactions recovered noticeably, strengthening magnesium plants' reluctance to budge on prices. However, downstream sentiment favored rushing to buy amid continuous price rise and holding back amid price downturn. Market transactions were primarily for essential stockpiling. A wave of production resumptions pushed daily output in main production areas to 2,000 mt. In the foreign trade market, downstream performance was overall weak. On one hand, bearish sentiment spread, with buyers mostly adopting a wait-and-see approach. On the other hand, end-use demand was indeed sluggish, as Q4 orders seen in previous years were either released early or significantly reduced this year, leaving new orders very limited. Overall, the magnesium market showed a weak and stable pattern.

Magnesium Alloy

Prices

Today, the mainstream tax-included ex-factory price for magnesium alloy in China was 18,000-18,100 yuan/mt. The Chinese FOB price for magnesium alloy was $2,520-2,580/mt.

Supply and Demand

Recently, magnesium alloy prices moved under pressure, tracking magnesium ingot prices, while magnesium alloy processing fees held up well. Recent market orders surged, and enterprise operating rates remained high. Although the tight supply situation eased slightly, most enterprises were still producing against order backlogs, and spot supply tightness persisted. Meanwhile, the situation of tight spot supply and inverted inventory provided continued support for the firm operation of magnesium alloy processing fees, keeping them at high levels.

Magnesium Powder

Price

Today, the mainstream ex-factory prices, including taxes, for 20-80 mesh magnesium powder in China were 17,250-17,450 yuan/mt; the FOB price in China was $2,410-2,520/mt.

Supply and Demand

Although the continuous decline in raw material prices boosted purchasing activity for magnesium powder to some extent, the overall "weak supply and demand" situation in the market remained unchanged. Dragged down by sluggish demand from downstream steel mills, orders for magnesium powder plants were generally flat, leading to a covert decline in the transaction center. Ultimately, amid the struggle between cost support and insufficient demand, magnesium powder prices showed a weak and stable trend.