It doesnt appear at all when i try to fuse it
like it doesn't show in the fusion menu
So, you have Mithril, but it's just not selectable in the fuse menu? That's bizarre. Well, you might've just missed it, but otherwise that's definitely a bug. No clue you'd go about fixing that, sorry.
If you just got the Mithril, my best suggestion is to load a save before you got the mithril, if possible, and see if getting it again fixes the issue. If not, you might try getting another mithril, and seeing if having a second one "updates" it somehow and lets you see it?