Asian Metal News
Shaanxi Fugu Meixin magnesium smelters have been grappling with issues of low semi-coke prices and slow sales of coke tar for some time and is facing losses of RMB80/t for every tonnne of semi-coke produced. In the wake of recently slumping magnesium prices and a bleak market outlook going forward, the company has decided to cut its magnesium production. The company reduced magnesium output to 15 tonnes per day and has no intension to restart in the short-term.
Designed with 10 ktpy of magnesium smelting capacity, the company produced 11 kt of magnesium in 2019 with its 2020 output at 2.2 kt in the year to date. It produced 800 tonnes magnesium in March, while April output is estimated at 450 tonnes. The company currently holds 200 tonnes in stock.
Mainstream magnesium prices dropped by RMB300/t from early last week to RMB13,300~13,400/t last Friday. Transactions were rare in the spot market, being propped by orders to feed fixed-demand. Domestic magnesium prices are likely to dip further in the short-term.