Faced with pressures of sluggish global economic recovery and economic slowdown in China, the global magnesium industry has been suffering with shrinking demand and debates on industry development in 2014 have been intense after some end-users reduced magnesium consumption by seeking alternatives.
Insiders had hoped to see an improvement in the magnesium export market with the cancellation of the 25% export tax rate of magnesium products on January 1, 2013. However, foreign traders and end-users started to purchase magnesium by prompt orders instead of long-term contracts to avoid risks as a result of the frequent price fluctuations, therefore the market begun to slow down. In addition, the fierce competition in export market encouraged more competitive offering prices, which had a bad influence on regular exporters. The export prices of magnesium kept at low level for some time, largely pulling down the domestic magnesium prices. In 2014, the overall demand from Europe, Asia and the American costumers declined, and profit margins were also severely squeezed. End-users started to build trade relations directly with domestic producers, which presented great challenges for traders. Meanwhile, traders were also faced with unprecedented risks and pressures with the adjustment of custom policies and sharp decline of exchange rate. Some insiders lamented the plight of magnesium industry and had turned to other businesses. Will Chinese magnesium export market structure be changed greatly?
China is a major producer of magnesium, accounting for 90 percent of global supply. Magnesium prices continued to decline, while foreign buyers focused on hand-to-mouth orders, resulting in a weak market. Could Chinese market pick up? Magnesium Industry Association of Shaanxi was unable to push the prices up by joint operation. Chinese producers operated with low profits, while some even lost money as oversupply of magnesium dragged the prices down again and again. Will magnesium industry witness massive production suspension, reformation and adjustment in the future?
Where will the magnesium industry go in 2015? Will participants earn profit or incur loss? Will capital or order-operation push the market forward? All the factors above are the most concerned topics of every insider. Let us get together to interpret market changes and growing process in order to obtain confidence and new growth points.
Accepting sustainable support and confidence from industry insiders, Asian Metal will host the “4th World Magnesium Forum” in Chengdu from April 16 to 17. Senior officials and industry experts from production sector, process sector and casting sector, as well as professional associations, information platforms, professional media and industry captains from auto, motorcycle, 3C industry and aviation sector, will discuss the development direction and seek a new trail.
We hope to see you this spring at the “4th World Magnesium Forum” in Chengdu.
