Magnesium Inventory Rises 1.33% MoM Amid High Prices and Reduced Supply Pressure

【SMM Weekly Magnesium Output Flash Report】From September 4 to September 10, the weekly output of national sample magnesium plants decreased by 4.1% month-on-month, with the weekly operating rate standing at 73.44%. According to research, affected by rising raw material prices that have pushed up production costs, multiple primary magnesium enterprises announced maintenance this week. Among them, three primary magnesium smelting enterprises suspended production for maintenance and two reduced output, leading to a notable decline in magnesium ingot production. It is understood that the maintenance period for manufacturers this week is expected to be around 10 days, and primary magnesium output is projected to remain at a low level and move sideways next week.

【SMM Magnesium Flash】This week, the social inventory of magnesium ingots decreased by 3.2% month-on-month, showing a trend of destocking. At the beginning of the week, domestic magnesium ingot prices continued to rise. Downstream customers and traders exhibited a strong aversion to high prices, and there were no large-scale proactive stock-up operations. Only rigid demand transactions were maintained, and market trading was relatively weak. Against the backdrop of rising ex-factory prices for magnesium ingots and no substantial recovery in demand, traders took the initiative to clear early low-priced stockpiles. As a result, the inventory transitioned from the previous pattern of accumulation to destocking. The continuous release of low-priced supply suppressed magnesium prices, coupled with the market mentality of "buying when prices rise and not buying when prices fall," the market continued to operate under pressure.

[SMM Magnesium Weekly Review: Coal Price Fluctuations Drive Magnesium Price Consolidation, Weak End-Use Demand Caps Upside] This week, dolomite supply structure diverged, with high-quality local ore sources in Wutai remaining tight. Enterprises purchased from other provinces to supplement supply, keeping overall ore supply sufficient and prices stable. Driven by wild swings in coal prices, magnesium ingot prices in main production areas rose first and then fell. At the start of the week, raw material cost push shot up magnesium prices, but downstream clients balked at high prices and reduced purchases. Coupled with the subsequent coal price pullback, magnesium ingot prices gave back all gains. Export FOB quotes edged down in tandem with domestic prices, export orders fell short of expectations, September-October peak season demand failed to materialize, and traders held a strong wait-and-see sentiment. Downstream magnesium powder and magnesium alloy were also under pressure. Magnesium powder followed magnesium ingot fluctuations, processing fees were under pressure, and downstream buyers only maintained rigid demand. Magnesium alloy saw weak supply but even weaker demand, with die-casting plant operating rates declining, inventory rising, and processing fees weakening. Overall, this week's magnesium industry chain was primarily disrupted by coal cost fluctuations, end-use demand showed no substantive recovery, and the entire industry lacked strong support, maintaining a fluctuating trend on a subdued note in the short term.