Supply-Demand Stalemate Intensified, Magnesium Prices Were Expected to Be Under Pressure Today [SMM Magnesium Morning Meeting Minutes]

SMM Magnesium Morning Meeting Minutes on November 27:

Magnesium raw material

prices

1-3 cm dolomite (Wutai) ex-factory price excluding tax was 108 yuan/mt, unchanged from the previous working day; 2-4 cm dolomite (Wutai) ex-factory price excluding tax was 128 yuan/mt, also unchanged from the previous working day; in Shaanxi, the mainstream ex-factory price for 75 ferrosilicon was 5,700-5,800 yuan/mt.

Supply and demand

Recently, Wutai dolomite prices have held steady, with magnesium producers in the main production areas maintaining stable operations, continuously releasing rigid demand for dolomite, providing strong support. It is expected that dolomite prices will continue to hold up well. The most-traded 2603 ferrosilicon futures contract closed at 5,416, down 32 from the previous working day. In the spot market, daily ferrosilicon production has shown a slight pullback, but the overall supply landscape remains stable. On the demand side, customers are purchasing as needed, with a rational procurement mindset, and there are no large-scale restocking or stockpiling actions. Considering the interplay between supply and demand, it is expected that short-term ferrosilicon prices will consolidate within a bottom range, without any significant unilateral fluctuation drivers.

Magnesium ingot

Today, the mainstream quotation for magnesium ingots in Fugu was 16,000-16,100 yuan/mt, down 50 yuan from the previous working day; China's FOB price was $2,240-2,340/mt.

Supply and demand

Yesterday morning, primary magnesium smelters tested the market with a quotation of 16,100 yuan/mt, but downstream buyers showed a strong fear of high prices, with their psychological price level mostly at 16,000 yuan/mt. As a result, inquiries were sluggish, and magnesium ingot trading volume was low. Overall, on the demand side, downstream customers had previously taken orders at lower prices, leading to a low acceptance of higher prices in the market. On the supply side, the supply-demand imbalance has increased inventory pressure for primary magnesium smelters, and it is expected that magnesium prices will continue to fluctuate downward.

Magnesium alloy

Today, the mainstream tax-inclusive ex-factory price for magnesium alloys in China was 17,900-18,050 yuan/mt; the FOB price for Chinese magnesium alloys was $2,500-2,570/mt.

Supply and demand

Magnesium alloy prices have moved in tandem with magnesium ingot prices. On the supply side, the magnesium alloy market supply landscape is gradually becoming more relaxed, but leading producers are still maintaining orderly production schedules based on order pace, without causing an oversupply situation due to large-scale capacity release. On the demand side, new demand from key application areas such as two-wheeled electric vehicles and NEVs continues to materialize, providing strong and stable demand support for the magnesium alloy market. However, influenced by the magnesium ingot price being under pressure, and the market supply-demand pattern currently in a transitional phase, it is expected that short-term magnesium alloy prices will be under pressure and show limited upward momentum.

Magnesium Powder

Price

Today, the mainstream ex-factory price, including tax, for 20-80 mesh magnesium powder in China was 17,200-17,400 yuan/mt; the FOB price in China was $2,420-2,480/mt.

Supply-Demand

The market price of magnesium powder remained stable, following the raw material prices, but actual orders in Q4 continued to be weak, and market expectations for the future remained cautious.