This week, magnesium prices experienced multiple rounds of increases. Apart from the effective alleviation of the magnesium ingot supply surplus caused by factory rectifications and the partial recovery of market confidence, the rise was also driven by higher quotations for export containers, which further stimulated downstream demand. Domestic downstream restocking followed, and trading volume in the market continued to improve, leading to a significant price increase this week. As of the time of writing, the transaction price of 99.9% magnesium ingots in major production areas was around 15,600-15,700 yuan/mt, up by 600 yuan/mt.
According to major production area magnesium plants, due to continuous destocking, plant inventories have declined significantly, effectively alleviating the previous supply surplus of magnesium ingots. Currently, selling prices are market-driven, with fewer high-price transactions, and the market has returned to a wait-and-see sentiment.
SMM analysis suggests that based on current market performance, as inventories in major production areas continue to decline, bearish sentiment in the magnesium market has been repaired. However, considering the limited acceptance of high prices by downstream buyers, the support for magnesium prices to fluctuate at highs is limited. SMM will continue to monitor subsequent changes in spot transactions.
