Chinese pure magnesium prices stabilize in muted trade

Tag : magnesium
Chinese pure magnesium prices have remained flat this week, quotingat $4,050-4,200/mt FOB China, unchanged from a week ago, according toindustry sources Tuesday. Prices were hardly moving in the absence of largetraded volumes with prices mostly concluded within a range of$4,080-4,180/mt FOB China. One China-based trader said he bought 300 mt of pure magnesiumfrom a Chinese smelter at $4,120/mt FOB China, prompt delivery. "Somesmelters think the $4,120/mt level is a good price to sell," he said, adding thatspot deals were heard quoting at around $4,080-4,180/mt FOB China. "There issome spot activity going on with slightly more buying inquiries fromoverseas," he said. A source close to Chinese producers said China Customs' floorprice on magnesium export currently set at $4,500/mt FOB China, unchangedfrom a week ago, material delivered at Tianjin port. "Before having this floorprice system, some Chinese smelters tried to lower their contract priceto escape from tariff but they will pay the difference to customers in asneaky way," he said. He also noted that the floor price was a move to protect thegovernment and secure the tariff, adding that China Customs changed theirfloor price based on market conditions. Current spot prices are quoted at below the floor price at$4,500/mt. Despite the high export tariff, Chinese exporters still managed tomake some profits at the current price level due to recent weakerferrosilicon and coal prices. Ferrosilicon and coal are the key feed supply in magnesiumproduction. Sources in China added that domestic prices were now quoted ataround Yuan 24,000-25,000 ($3,509-3,655)/mt ex-plant, unchanged from aweek ago. One local producer said the market had a lack of buying inquiries."It's difficult to find buyers at $4,200/mt FOB China. The market is not verystable due to a lack of big volumes traded." Platts' assessment for Chinese puremagnesium prices this week was unchanged at $4,050-4,200/mt FOB China. --Wendy Shair, wendy_shair@platts.com For similar news, request a free trial to Platts Metals Week at http://www.platts.com/Request%20More%20Information/index.xml?src=story or subscribe now at http://getmetalsweek.platts.com