Authorities in China delayed the reopening of businesses
until Monday February 10 at the earliest in most provinces, as
part of the measures to contain the outbreak of coronavirus
infection. Now, however, magnesia availability has started to
show an improvement with production being restarted.
Most producers resumed all or part of their production early
this week, but there were others which will return to work next
week or at the end of February.
"We resumed 70-80% of our production this week, and we
started running our caustic calcined magnesia and fused
magnesia production lines," one producer told Fastmarkets, "but
high-purity magnesia production is still halted for the
Magnesia export prices have not shown any fluctuations this
week. Some producers received more inquiries, but no new deals
were concluded because most overseas buyers were watching the
development of the coronavirus situation in China and
considering what further risks there might be to materials
supply and transport availability.
"Magnesia prices were unchanged compared with the level
before the lunar new year holiday," a second producer said.
"Some other products with lower stock levels might show an
increase but, for magnesia, which has sufficient stocks, I
think it will be hard to increase prices at the moment."
Fastmarkets’ price assessment for magnesia, dead burned, 97.5% MgO, lump, fob
China, was $400-450 per tonne on February 11, and the
corresponding assessment of the price for magnesia, calcined, 90-92% MgO, fob China,
was $140-180 per tonne on the same day. Both prices have been
rangebound so far in 2020.
The logistics situation has improved a little this week, but
the numbers of qualified healthy drivers and available freight
cars remained low, and some logistics operators have increased
domestic freight fees by 20% or more.
Moreover, with some key international shipping lines
returning to work no earlier than February 17, international
deliveries might be subject to delays if buyers want materials
delivered in February.
"I think shipping to Japan and South Korea will be minimally
affected because of the short distances involved," an exporter
said. "But some deliveries to Europe or the United States might
be delayed because we are not sure whether there will be a
pile-up of goods at port because of the delay to businesses
reopening. We will continue to monitor this."
China’s domestic downstream buying for magnesia
remained slow this week, with most refractory enterprises only
just back to work or still at a halt. There was only limited
activity seen in the market so far this week.
"I haven’t started purchasing magnesia this
week," a buyer said, "because our domestic refractory plants in
Tianjin and Guangdong provinces are still waiting for a notice