Magnesium ingot market in China is showing some signs of softening after stabilizing for over one week. Weak demand is still considered as the key factor affecting the price, market sources reported to Asian Metal today.
A Henan-based trader, with a trading volume of 800-900tpm, has just purchased some magnesium ingot at RMB23,500/t (USD3,436/t) ex works while most smelters insisted on offers at RMB23,800-24,000/t (USD3,480-3,509/t) ex works last week. The source heard that some smelters reportedly undersold magnesium ingot at prices below RMB23,500/t (USD3,436/t) ex works and said that they would like to purchase some if one can offer such low prices.
"Although we feel that the current price is relatively low, it seems that it still has not touched the bottom line," said the source. "Judging from the current situation, we're afraid that the price may continue to go down by a small margin before the National Day."
A Shanxi-based consumer confirmed that the magnesium ingot price is going down mildly. According to the source, although smelters have been trying to keep the price stable or even push it up in the name of more inquiries in the last two weeks, few deals buyers placed orders after they got offers from smelters. "Therefore, the seemingly active market has not seen good deals."
The source bought tens of tons of magnesium ingot at a price lower than RMB23,800/t (USD3,480/t) ex works last week and said that the same supplier had lowered the quotations by RMB100-200/t (USD15-29/t) this week to promote sales. "We were shocked that some smelters in Fugu and Taiyuan sold out stocks at RMB23,000/t (USD3,363/t) ex works last weekend," said the source, "but the prevailing price was still higher than RMB23,600/t (USD3,450/t) ex works."
Consuming about 600t of magnesium ingot every month, the smelter mainly purchases raw material from Shanxi province. The source predicts that the magnesium ingot price is likely to decline further this week, but the price decrease is expected to be limited in view of the high-held production cost.
One of largest magnesium producers in Taiyuan, Shanxi suspended offering as the company does not want to sell any material at prices lower than RMB24,000/t (USD3,509/t) ex works. However, the source acknowledged that the market demand has kept weak and bids from buyers have also been in decline. Meanwhile, the source revealed that many coke producers reduce production due to the sluggish market, leading to short supply of coal-gas which affects the production of some magnesium ingot smelters. Nevertheless, the production reduction is expected not to exert any impact on the magnesium market in the face of weak demand.
A Henan-based trader, with a trading volume of 800-900tpm, has just purchased some magnesium ingot at RMB23,500/t (USD3,436/t) ex works while most smelters insisted on offers at RMB23,800-24,000/t (USD3,480-3,509/t) ex works last week. The source heard that some smelters reportedly undersold magnesium ingot at prices below RMB23,500/t (USD3,436/t) ex works and said that they would like to purchase some if one can offer such low prices.
"Although we feel that the current price is relatively low, it seems that it still has not touched the bottom line," said the source. "Judging from the current situation, we're afraid that the price may continue to go down by a small margin before the National Day."
A Shanxi-based consumer confirmed that the magnesium ingot price is going down mildly. According to the source, although smelters have been trying to keep the price stable or even push it up in the name of more inquiries in the last two weeks, few deals buyers placed orders after they got offers from smelters. "Therefore, the seemingly active market has not seen good deals."
The source bought tens of tons of magnesium ingot at a price lower than RMB23,800/t (USD3,480/t) ex works last week and said that the same supplier had lowered the quotations by RMB100-200/t (USD15-29/t) this week to promote sales. "We were shocked that some smelters in Fugu and Taiyuan sold out stocks at RMB23,000/t (USD3,363/t) ex works last weekend," said the source, "but the prevailing price was still higher than RMB23,600/t (USD3,450/t) ex works."
Consuming about 600t of magnesium ingot every month, the smelter mainly purchases raw material from Shanxi province. The source predicts that the magnesium ingot price is likely to decline further this week, but the price decrease is expected to be limited in view of the high-held production cost.
One of largest magnesium producers in Taiyuan, Shanxi suspended offering as the company does not want to sell any material at prices lower than RMB24,000/t (USD3,509/t) ex works. However, the source acknowledged that the market demand has kept weak and bids from buyers have also been in decline. Meanwhile, the source revealed that many coke producers reduce production due to the sluggish market, leading to short supply of coal-gas which affects the production of some magnesium ingot smelters. Nevertheless, the production reduction is expected not to exert any impact on the magnesium market in the face of weak demand.
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