Sliding price of magnesium in Chinese market is affecting price in Europe as sources reported deals concluded at around USD5,800-5,900/t in warehouse Rotterdam because materials bought at high price are still in Europe. According to participants, the dropping price in China could only reflect much in European market when new material arrives in Europe.
Meanwhile, market is extremely quiet with buyers buying only hand to mouth and waiting for the price drop in Chinese market to touch the floor.
Some participants reported getting offers from China as low as around USD5,040/t while most market participants reported quotations at around USD5,400-5,600/t. However, the general feeling in the market is that price will continue to move down until some producers start to close down for Olympics then sellers will have a good reason to ask for high prices.
According to an European dealer who put the price in warehouse Rotterdam at around USD5,800/t, although he has not concluded any deals recently due to weak demand, market is resting and will start to move again if Chinese suppliers reduce their stocks.
Another trader reported some inquiries recently which he will quote at around USD5,800-5,900/t in warehouse Rotterdam as spot deals are at that price, down from around USD6,000-6,100/t they were selling before.
The source agreed that price in Europe will go down gradually because material bought from China now has not arrived in Europe. The source added that there is less material in Europe at the moment since buyers are not buying because of the high price and if anybody wants to buy material now, he should pay what suppliers quote.
But the fact is that buyers are watching the market as price in China is going down and most of them expect it to hit below USD5,000/t FOB.
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