Magnesium prices firm
2008-02-25 11:14:06 【Print】
BEIJING (Asian Metal) 25 Feb 08 - Magnesium ingot market remains firm with quotations standing at around RMB25,000/t (USD3,497/t) ex works. Producers reported that demand has been warming up after the Spring Festival, which is likely to support the price to keep at the current level.
A Shanxi-based producer just resumed full production late last week whereas it was running at 1/3 of its capacity of 10,000tpy before the Spring Festival due to lack of FeSi caused by the traffic standstill under the snowy weather. As the smelter's production just returned to normal, it has not many materials to supply. "Therefore, although we received many inquiries from magnesium powder and alloy producers, we cannot serve all the demand," an official from the smelter told Asian Metal.
The source revealed that they sold a batch of magnesium ingot at around RMB24,300/t (USD3,399/t) ex works early last week while the mainstream price rose to RMB24,700-24,800/t (USD3,455-3,469/t) ex works at the end of last week and some large smelters reportedly concluded deals at prices above RMB25,000/t (USD3,497/t) ex works.
The source reported that the coal supply in the region is so tight that many smelters are forced to run below their capacity. Furthermore, the coal price has kept climbing up during the past few months to current RMB700/t (USD98/t) delivered. The source believes that more demand and also tight supply of coal will help the market keep at a high level.
A Ningxia-based magnesium producer with an output of around 8,000tpy concluded a small deal at RMB24,800/t (USD3,469/t) ex works. The source reported that demand is active after the Spring Festival which will probably prompt the price to move up further.
As some consumers did not order large quantities of magneium ingot with expectations that the market would go lower after the holiday, they need to purchase the material to satisfy the production. That is why many magnesium ingot producers reported more inquiries in the market. However, it is still unclear that how many new smelters will enter the market and thus bring more supply, so it is too early to say whether the price will continue to edge up or not. Meanwhile, another round of snowfall is forecast for South Shanxi, where many magnesium ingot smelters are located. Some participants worry that the bad weather will affect the market again if transportation is hampered once more.
A Shanxi-based producer just resumed full production late last week whereas it was running at 1/3 of its capacity of 10,000tpy before the Spring Festival due to lack of FeSi caused by the traffic standstill under the snowy weather. As the smelter's production just returned to normal, it has not many materials to supply. "Therefore, although we received many inquiries from magnesium powder and alloy producers, we cannot serve all the demand," an official from the smelter told Asian Metal.
The source revealed that they sold a batch of magnesium ingot at around RMB24,300/t (USD3,399/t) ex works early last week while the mainstream price rose to RMB24,700-24,800/t (USD3,455-3,469/t) ex works at the end of last week and some large smelters reportedly concluded deals at prices above RMB25,000/t (USD3,497/t) ex works.
The source reported that the coal supply in the region is so tight that many smelters are forced to run below their capacity. Furthermore, the coal price has kept climbing up during the past few months to current RMB700/t (USD98/t) delivered. The source believes that more demand and also tight supply of coal will help the market keep at a high level.
A Ningxia-based magnesium producer with an output of around 8,000tpy concluded a small deal at RMB24,800/t (USD3,469/t) ex works. The source reported that demand is active after the Spring Festival which will probably prompt the price to move up further.
As some consumers did not order large quantities of magneium ingot with expectations that the market would go lower after the holiday, they need to purchase the material to satisfy the production. That is why many magnesium ingot producers reported more inquiries in the market. However, it is still unclear that how many new smelters will enter the market and thus bring more supply, so it is too early to say whether the price will continue to edge up or not. Meanwhile, another round of snowfall is forecast for South Shanxi, where many magnesium ingot smelters are located. Some participants worry that the bad weather will affect the market again if transportation is hampered once more.
