Magnesium Market Fluctuated and Diverged This Week, Magnesium Alloy Alone Supported the Overall Situation [SMM Magnesium Weekly Review]

1 Market Review

1 Dolomite

This week, the ex-factory price (excluding tax) for 1-3 cm dolomite (Wutai) was 108 yuan/mt, basically flat WoW, while that for 2-4 cm dolomite (Wutai) was 138 yuan/mt, basically flat WoW.

Dolomite market prices remained stable this week. Supply side, resumption of production at some small and medium-sized producers saw no clear progress due to factors like expired mining licenses; however, dolomite supply in major primary magnesium smelting regions was mainly ensured by top-tier enterprises, keeping overall supply stable. Demand side, operating rates at plants in Shaanxi and Shanxi, the two core primary magnesium smelting regions, held steady, providing solid demand support for the dolomite market. Considering both supply and demand, the dolomite market's supply-demand pattern is balanced, with prices showing stable characteristics.

1.2 Magnesium Ingot

1.2.1 Magnesium Ingot (Fugu, Shenmu - Major Production Areas)

This week, magnesium prices fluctuated rangebound. As of press time, mainstream quotations for 99.90% magnesium ingot in major production areas were 16,000-16,100 yuan/mt, with the weekly average price basically flat WoW.

Magnesium prices fluctuated rangebound this week. At the week's start, the "purchase and storage" news gradually fueled market sentiment, leading some downstream buyers to procure, either for restocking or stockpiling bets on price rises. Market transactions were active, helping prices stop falling and rebound. Some primary magnesium smelters raised offers to 16,200 yuan/mt. However, as downstream buying failed to keep pace, bullish sentiment waned, and prices fell again. Overall, the supply-demand pattern remains hard to reverse, with the magnesium market expected to stay under pressure.

1.2.2 Magnesium Ingot (Tianjin Port - FOB China)

This week, the FOB China price was quoted at $2,240-2,340/mt, averaging $2,290/mt. FOB prices remained in the doldrums, with inquiry prices dropping again.

The mainstream transaction range for FOB market this week was $2,220-2,290/mt. Recent deals were mostly forward orders, reflecting weak actual demand. Influenced by the "rush to buy amid continuous price rise and hold back amid price downturn" mentality, traders built some stockpiles early in the week, but for accepted forward orders, most planned to purchase closer to the delivery date. Amid overall sluggish demand, traders' profit margins continued to be squeezed, and competition intensified.

1.3 Magnesium Powder

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

At the beginning of the week, the magnesium powder market saw improved procurement enthusiasm driven by rising raw material prices, with moderate transaction performance. However, the downward trend has not reversed. With weakening support from raw material costs and insufficient new orders, prices continued to hit bottom. Although some producers experienced phased growth in procurement volume, it was mostly concentrated in just-in-time procurement and long-term agreement order execution, failing to generate sustained recovery momentum. Bearish sentiment still dominates the market trading atmosphere, and the weak pattern is expected to continue in the short term.

1.4 Magnesium Alloy

This week, the mainstream tax-inclusive ex-factory price for magnesium alloy in China was 18,050-18,150 yuan/mt, and the mainstream FOB price for Chinese magnesium alloy was $2,500-2,570/mt.

This week, magnesium alloy market prices showed a firm trend. On the supply side, enterprises in the main production areas maintained full capacity operation; meanwhile, driven by demand, processing orders in Guangdong increased, leading to a slight rise in local recycled magnesium alloy production, which somewhat alleviated the tight supply situation in the magnesium alloy market. On the demand side, market attention for magnesium alloy continued to grow. The implementation of the new national standard policy in September boosted demand from the two-wheeled EV sector, and the penetration rate of magnesium alloy in NEV interior components gradually increased. Under the combined effect of these factors, magnesium alloy market demand achieved significant growth compared to the same period last year. Overall, the magnesium alloy market supply and demand remain in a tight balance. With firm offers from leading producers, magnesium alloy processing fees are expected to remain firm.

2 Weekly Summary

This week, the magnesium market showed a clear divergence. On the raw material side, dolomite prices held steady with stable supply and solid demand support. The magnesium ingot market fluctuated rangebound; it briefly rebounded at the start of the week stimulated by procurement and storage news, but fell again due to insufficient downstream follow-through, remaining under pressure amid a supply-demand imbalance. FOB prices for foreign trade remained weak, with transactions mainly focused on forward orders; traders faced profit pressure and intensified competition. The magnesium powder market continued its bottom-seeking trend amid weakening cost support and a lack of new orders, with just-in-time procurement unable to reverse the weakness. Magnesium alloy was the highlight of the week. Against the backdrop of full capacity operation in main production areas and increased recycled material production in Guangdong, demand was boosted by the new national standard and NEV applications. Supply and demand maintained a tight balance, and processing fees remained firm. Overall, except for magnesium alloy, other magnesium products faced demand insufficiency, and the short-term market is expected to remain in the doldrums.