The fundamentals of magnesium ingots in May are difficult to improve, and short-term prices may experience narrow fluctuations

In May 2024, the overall cash and tax inclusive price range for magnesium ingots (99.9%, non acid washed, simple packaging) from various major production areas in China is between 18400 and 18800 yuan/ton, with actual orders mainly negotiated.


The specific price range for each region on the 31st is as follows:


The ex factory tax inclusive spot exchange in Fugu area is 18600-18700 yuan/ton; The current exchange rate in Taiyuan area is 18700-18800 yuan/ton; The current exchange rate in Wenxi area is 18800-18900 yuan/ton; The current exchange rate in Ningxia is 18600-18700 yuan/ton.


Magnesium ingots are native magnesium ingots in accordance with the national standard (GB/T3499-2011); Non acid washing, no wooden pallets, and non payment acceptance price, actual order negotiation is the main focus.


Overview of the trend of magnesium metal in May


According to data from Business Society, the average domestic market price on the 31st was 18700 yuan/ton, an increase of 0.18% compared to the average market price of 18666.67 yuan/ton in early May (5.1); Compared to the beginning of the year (1.1), the average market price was 20600 yuan/ton, a decrease of 9.22%.


In April, the magnesium ingot market first fell and then rose, with overall prices slightly rising. The supply and demand sides are more in a stalemate game, with manufacturers supported by costs and relatively firm quotes, leading to a slight increase in magnesium prices. However, downstream buyers have limited acceptance of high prices, resulting in insufficient efforts to further boost magnesium prices.


In terms of supply and demand


In terms of factories, the magnesium plant has slightly increased in operation, and the market supply is relatively sufficient. Due to the continuous increase in production costs, manufacturers are reluctant to sell at low prices, and their price support sentiment is relatively strong. In terms of demand, after the end of the holiday at the beginning of the month, there was an increase in market procurement release. However, with the increase in magnesium ingot prices and the need for pre holiday procurement customers to consume inventory, downstream market procurement prices have stabilized, and procurement is mainly cautious and wait-and-see.


In terms of exports, according to Chinese customs statistics, China exported a total of 161300 tons of various magnesium products from January to April, a year-on-year increase of 21.46%; The cumulative amount is about 486 million US dollars, a year-on-year decrease of 3.70%. Among them, a total of 93200 tons of magnesium ingots were exported, a year-on-year increase of 39.52%; Magnesium alloy exports totaled 34200 tons, a year-on-year decrease of 11.63%; A total of 29000 tons of magnesium powder were exported, an increase of 30.04% year-on-year. The export price of magnesium ingots in April was lower than expected, and the export volume decreased significantly compared to March.


Ferrosilicon rose 19.34% in May


In May, the price of ferrosilicon increased significantly, especially with the issuance of the “2024-2025 Energy Conservation and Carbon Reduction Action Plan” at the end of the month. The bullish sentiment in the ferrosilicon market was strong, and ferrosilicon futures rose to the limit at 7824 yuan. The spot market was affected by market conditions, and some manufacturers suspended their quotations. According to the Commodity Market Analysis System of Shengyishe, as of May 30, the price of ferrosilicon was 7714.29 yuan/ton. The blue charcoal market remained stable and rose in May, as coal prices rose and blue charcoal companies showed a clear sentiment of price support. The strong operation of raw material prices and the strengthening of cost support for magnesium ingots.


Future Market Forecast

From the perspective of supply and demand, it is difficult to change the short-term fundamentals of strong supply and weak demand. The market is relatively anxious, and downstream customers are resistant to high prices. They are holding onto rigid demand to buy at low prices, and the upward trend of magnesium prices is showing signs of weakness. But due to cost support, it is difficult for magnesium prices to decline. Overall, the short-term price of magnesium ingots is in a dilemma, and the future market tends to be dominated by narrow fluctuations.

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