SHANGHAI, Mar 9 (SMM) – China's magnesium ingot output stood at 69,000 mt in February, up 7.5% MoM but down 17% YoY, according to SMM statistics. The output totalled 133,000 mt in January-February 2023, a year-on-year decrease of 19.7%.
With the returning of migrant workers to their workplace after CNY holidays, operating rates at magnesium plants rose compared to January. However, the performance of the downstream market after the holidays fell short of market expectations. This, coupled with lower magnesium prices, resulted in great cost pressure of magnesium factories in Shanxi. And some alloy enterprises reduced the proportion of primary magnesium production.
The head of a large magnesium factory said that the current downstream environment is poor, and the actual market demand has dropped by 20-30% compared with the same period last year. Should downstream demand remain sluggish, they will not rule out cutting output to tackle ample supply. The output at magnesium plants is expected to fall in March to some 66,000 mt. SMM will continue to pay attention to the changes in production in the main producing areas.
