[SMM Magnesium Weekly Review: Weak Supply and Demand Jointly Dominated Magnesium Price Trends, While Structural Divergence Emerged Across Segments] This week, operating trends across various products in China’s magnesium industry chain diverged, with the overall market characterized mainly by stability and rangebound fluctuations. The stalemate in market supply and demand became increasingly evident, and momentum for a unilateral market move remained insufficient. The upstream dolomite market maintained stable operations. Although a top-tier enterprise in the Wutai region suspended production, ample raw material inventory in place and timely capacity replenishment in major producing areas, coupled with a steady pace of just-in-time procurement by primary magnesium enterprises, kept prices stable without fluctuations. As the core product, magnesium ingot prices in China’s main producing areas consolidated at high levels, with mainstream transaction prices remaining stable. Market transactions showed mediocre performance, while producers demonstrated strong reluctance to sell. Against a backdrop of weak supply and demand, quoted prices fluctuated rangebound. On the export side, FOB quotations loosened slightly, and as ocean freight rates pulled back, inquiries from outside China recovered somewhat, with expectations for forward order placements. Supported by raw materials and boosted by the entry of export orders, the magnesium powder market saw firm quotations and held up well. In March, industry operating rates gradually recovered, and support from the demand side became increasingly evident. Magnesium alloy prices overall remained stable. On the supply side, as top-tier enterprises resumed production and newly added capacity gradually came on stream and ramped up output, downstream buyers mainly focused on just-in-time restocking, resulting in a pattern of strong supply and weak demand. Prices are expected to remain in the doldrums going forward. Looking across the entire industry chain, there have been no significant changes in current market fundamentals, and in the short term the market will still be dominated by steady fluctuations and marginal adjustments in some segments.

On March 10, 2026, Lynas and Japan’s JARE signed a long-term deal featuring PrNd floor prices, profit-sharing, and heavy rare earth priority. Analyzing 2025 production data, this report evaluates the partnership’s commercial terms, operational progress, and downstream demand security.

The market quotation for praseodymium-neodymium oxide is in the range of 880,000 - 890,000 yuan/tonne, representing an increase of approximately 35,000 yuan/tonne compared to pre-holiday levels, a rise exceeding 4.12%. This marks a staggering 98% increase year-on-year. The quotation for praseodymium-neodymium metal stands at 1.07 - 1.08 million yuan/tonne, up by 50,000 yuan/tonne (4.88%) from pre-holiday prices, also reflecting a 95% year-on-year increase.

During the 2026 Spring Festival holiday, the domestic manganese sulfate market continued its pre-holiday upward trend, with prices maintaining stable and firm operation without significant fluctuations. On the supply side, although some enterprises suspended production for maintenance during the holiday leading to short-term fluctuations, the industry's low inventory pattern remained unchanged.

[SMM Magnesium Weekly Review: High Costs and Demand Wait-and-See Game, Magnesium Market Continued Rangebound Fluctuations Before the Holiday] This week, the magnesium market overall exhibited a pattern of stable supply and demand alongside strengthening cost support. The price of raw material dolomite remained firm due to tightening supply in the main production areas and rising logistics costs. Influenced by losses in semi coke, the cost of magnesium ingot increased significantly. However, affected by increased willingness among small and medium-sized producers to recoup funds and sluggish transactions, the price dropped back slightly to around 16,400 yuan/mt. Both domestic and international markets were dominated by forward orders, with downstream players generally adopting a wait-and-see attitude. Trading in the magnesium powder and magnesium alloy markets was stable, with magnesium alloy processing fees remaining firm amid cost fluctuations. Overall, the current market is fluctuating rangebound between cost support and demand wait-and-see, and it is expected to continue consolidating before the holiday.

According to statistics from the National Energy Administration, the investment completed in power grid projects in April reached 46.3 billion yuan, up 47% YoY and 5% MoM. From January to April, the total investment completed in power grid projects was 122.9 billion yuan, up 25% YoY. SMM believes that the operating rate of the aluminum wire and cable industry is expected to remain in the doldrums in the short term. The industry is currently undergoing an adjustment phase following the conclusion of the concentrated delivery period in the early stage. Leading enterprises are sustaining production with the support of order resilience, while small and medium-sized enterprises are facing significant pressure.

[SMM Analysis of Downstream Aluminum Sector: PMI of Aluminum Processing Industry Declined 1.8% MoM in May - Weak Domestic Demand Across Most Sectors, with Significant Structural Differentiation] The composite PMI of the aluminum processing industry in May was recorded at 49.8%, approaching the 50 mark but still in contraction territory, down 1.8 percentage points MoM and up 8.7% YoY.

[SMM Weekly Survey on Aluminum Downstream: Operating Rate of Aluminum Processing Industry Remains Flat WoW at 61.4%, Mid-Year Consumption Promotions Expected to Support Operating Rates] This week, the operating rate of leading enterprises in China's aluminum processing downstream sector remained flat WoW at 61.4%, with continued divergence across different segments.

Since April, the operating rate has declined by about 30 percentage points due to tight raw material supply, high costs, weak end-use consumption, and poor lead ingot sales. The low scrap volume of waste lead-acid batteries has led to scarce market supply and significant pressure on recyclers. Secondary lead smelters face tight scrap battery arrivals, low raw material inventories, and high purchase offers. Intense competition for raw materials and customer-specific price increases have further complicated the situation. Lead prices remained sideways during the week, with downstream battery producers showing a strong wait-and-see sentiment. Secondary lead smelters had low willingness to sell due to cost pressure, and the spot market for secondary refined lead was sluggish. As of May 16, the theoretical profit and loss value for large-scale secondary lead enterprises was -592 yuan/mt, and -820 yuan/mt for small- and medium-sized enterprises.

The domestic supply of lead concentrates remains tight, with scarce forward quotes for spot orders of imported ore. Smelters have shown low purchasing interest in imported high-silver lead ore with Pb60TC quoted at below -$30/dmt. It is expected that lead concentrates arriving at ports in the future will still be dominated by long-term orders. Some smelters in regions such as Hunan and Inner Mongolia in China have mentioned that there may be a downward adjustment in the price negotiations for lead concentrates by the end of May. This week, there has been no significant change in the domestic TCs for lead concentrates. 》Click to view the SMM Metal Industry Chain Database