Ene 07

China’s magnesia stocks up, prices down ahead of Lunar New Year holiday

Chinese export prices for fused magnesia (FM ) and dead burned magnesia (DBM) have gone on a downtrend, tracking recent falls in the domestic market after production resumed in Dashiqiao.

Chinese domestic prices for fused magnesia (FM) and dead-burned magnesia (DBM) have been on a downtrend since production was resumed by most magnesia producers in the city of Dashiqiao in Liaoning province, which in turn led to rising stock levels.

Dashiqiao closed all its DBM kilns, and some FM kilns, in October 2019 because of pollution-limitation inspections. But production has gradually resumed this yearwith producers meeting new emissions standards, increasing the domestic supply.

Exporters have also lowered their prices because of the falls in domestic prices.

Although magnesia prices drifted lower, downstream buyers showed limited buying interest because of the approach of the Lunar New Year holiday on February 4-10. Transport movements will begin to stop gradually from this week.
Fastmarkets’ assessment of the price for FM, 97% MgO (Ca:Si 1:1), was $950-1,050 per tonne fob China on Tuesday January 22, down from $1,000-1,100 per tonne the week before. The price for FM, 97% MgO (Ca:Si 2:1), was $1,200-1,300 per tonne on the same day, down week on week from $1,250-1,350 per tonne.

«Magnesia prices have fallen by 300-600 yuan [$44-88] per tonne in the domestic market on increased material availability, and we lowered our export prices this week following the domestic downtrend. While we have received a few inquiries, no deals have been concluded yet,» an exporter in Dalian told Fastmarkets.

«Magnesia prices are in a mess ahead of the Lunar New Year, with some suppliers selling at lower prices to boost cash flow, but some high-quality magnesia prices remained at a high level,» a trader said.

The price of DBM, 90% MgO, lump, was $230-260 per tonne fob China on January 22, down from $240-270 per tonne in the previous week.

The price for DBM, 97.5% MgO, lump, fell to $1,050-1,250 per tonne fob China on Tuesday from the previous $1,100-1,300 per tonne, while the price for DBM, 94-95% MgO, lump, was assessed at $580-630 per tonne fob China, also on Tuesday, down from $600-650 per tonne last week.

«We do not have a purchasing plan before the Lunar New Year,» a buyer said, «but we will watch the market carefully to see whether the Liaoning [regional] government will release explosives for use in mining in the first half of 2019.»

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