Magnesium Market Update (May 9, 2013)

Magnesium prices continue to drift lower amid a supply glut and lackluster demand for the metal in most regions.

“It’s a bit softer and most regions are struggling. So there’s more supply out there and it’s not in strong hands. These guys can’t sit on it forever,” said one magnesium trader quoted by Metal-Pages.

Despite solid demand from US automakers, which posted a 8.5 percent gain in automobile sales in April, the US magnesium price (magnesium min 99.9 percent) slipped 1.46 percent to between $1.92 and $2.12 a pound from the previous $1.95 to $2.15 range. In China, magnesium min 99.9 percent is down by 2.1 percent, to between 16,100 and 16,600 renminbi per metric tonne, from the previous range of 16,400 to 17,000 renminbi. In Europe the magnesium price remains flat at $2,880 to 2,930 per metric tonne.

Company news

Magnesita, a Brazilian refractory metals producer, announced in April the signing of a $22 million deal to purchase Dalian Mayerton Refractories (DMR), a Chinese company in Liaoning province.

“Magnesita expects to integrate the plant and achieve full production capacity of 50,000 tons of mag-carbon bricks within two years, with the possibility of further expansion in the future,” a company statement reads.

China holds a quarter of the world’s magnesite reserves, according to Metal-Pages.