China magnesium export offers rise further on stronger domestic prices
Source: www.chinamining.org Citation: Platts Date: July 25, 2016
Spot export offers of Chinese magnesium ingot, basis FOB, rose further this week, supported by a firm domestic market seeing steady demand but tight supply as plants shut for scheduled maintenance, industry sources said Friday.
Export trades, however, remained thin as overseas buyers viewed current prices as too high, they also said.
Platts raised its weekly acid-washed magnesium ingot (minimum 99.8%) export price assessment to $2,200-$2,230/mt FOB China Friday, from $2,150-$2,180/mt FOB China a week ago.
The assessment included the compulsory Chinese 17% value-added tax and acid washing cost at Yuan 100-Yuan 150/mt ($15-$22/mt).
The Chinese magnesium die-cast alloy price assessment was also increased to $2,480-$2,510/mt FOB China, up from $2,430-$2,460/mt last Friday.
A north China-based producer said: "The domestic magnesium price has gone up to Yuan 15,000/mt ex-works for acid-washed material with VAT early this week. The spot supply is tight, while the domestic demand is steady. FOB offers are probably at $2,230-$2,240/mt, but overseas buyers have rejected the level, saying it is too high."
Another north China-based producer agreed, saying: "The domestic price has jumped sharply on Monday-Tuesday as the spot supply is tight. Domestic offers in Fugu (Shaanxi) are at Yuan 14,500/mt ex-works for non-acid-washed material but with VAT. Shanxi`s offers are at Yuan 14,800/mt ex works (for non-acid washed material but with VAT). FOB offers for acid washed material with VAT are probably around $2,310/mt on Tuesday."
"Domestic offers are at Yuan 14,500/mt (non-acid washed material but with VAT), up from Yuan 14,000/mt last week. Based on the current domestic price, FOB offers should be around $2,250/mt. However, the overseas demand is still lacking," a northwestern Chinese producer said.
A south China-based trader agreed overseas demand had been very weak.
"Nobody is asking for magnesium ingots but I heard FOB offers have been rising due to higher Chinese domestic price on tight supply and steady domestic demand. I heard someone indicated at $2,250/mt FOB, up from $2,150/mt last week. The market is weak due to the summer holiday and traded volume is thin," the trader said.
A Japanese trader said: "I heard many Chinese traders are delaying their deliveries as available spot material is very limited in the market due to maintenance shutdown."
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