Supply-demand stalemate escalates, magnesium prices faced downward pressure today [SMM Magnesium Morning Meeting Minutes]

SMM December 3 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 5,700-5,800 yuan/mt.

Supply and Demand

Recently, Wutai dolomite prices held steady. Magnesium producers in the main production area maintained stable production operations, with sustained release of rigid demand for dolomite providing strong support. Dolomite prices were expected to continue holding up well. The previous working day, the most-traded ferrosilicon futures contract, 2603, closed at 5,448, up 2. In the spot market, ferrosilicon spot prices consolidated near the bottom. Recent market transactions showed some recovery, but considering the traditional industry off-season leading to insufficient demand support, ferrosilicon prices were expected to remain stable.

Magnesium Ingot

Today, mainstream quotations for magnesium ingot in Fugu were 15,900-16,000 yuan/mt, down 50 yuan/mt from the previous working day; the China FOB price was $2,240-2,310/mt.

Supply and Demand

Yesterday morning, leading primary magnesium smelters held firm at 16,000 yuan/mt, while some smaller primary magnesium smelters sold at 15,900 yuan/mt following the market. Market transactions saw some recovery, but downstream traders exhibited strong sentiment of rushing to buy amid continuous price rise and holding back amid price downturn. Downstream purchasers engaged in bargain down purchasing prices, and some producers offered discounts to stimulate transactions, causing the market transaction center to shift lower. Against the backdrop of persistently weak demand and gradually increasing inventory pressure, magnesium ingot prices remained in a downward trend.

Magnesium Alloy

Today, the mainstream tax-included ex-factory price for magnesium alloy in China was 17,900-18,100 yuan/mt; the China FOB price for magnesium alloy was $2,500-2,560/mt.

Supply and Demand

Recently, magnesium alloy prices moved in sync with magnesium ingot trends. Supply side, the magnesium alloy market supply landscape gradually loosened, but leading producers still maintained orderly production schedules based on order pace, with spot cargo relatively tight. Demand side, new demand from core application areas such as two-wheeled electric vehicles and NEVs continued to materialize, providing strong and stable demand support for the magnesium alloy market. However, influenced by factors including primary magnesium ingot prices being under pressure, magnesium alloy prices were expected to show a pressured and fluctuating trend in the short term.

Magnesium Powder

Prices

Today, the mainstream tax-included ex-factory price for 20-80 mesh magnesium powder in China was 17,150-17,350 yuan/mt; the China FOB price was $2,410-2,470/mt.

Supply-demand

Yesterday, the market price of magnesium powder was affected by raw materials and declined again. The overall market performance was relatively mediocre, and the trading atmosphere showed no significant improvement. Market demand remained weak, and magnesium powder production basically operated based on demand.