Rising production costs push up magnesium ingot prices, while sluggish demand limits rebound [SMM Magnesium Ingot Spot Express]

SMM, September 1:

Today, mainstream quotations for GB 99.90% magnesium ingot in Fugu stood at 16,050-16,150 yuan/mt, and mainstream quotations for GB 99.80% magnesium ingot in Fugu stood at 16,000-16,100 yuan/mt. China FOB prices were reported at $2,270-2,370/mt.

Today, mainstream quotations for magnesium ingot in China stood at 16,000-16,100 yuan/mt. Transactions at the lower end were moderate, but follow-through at higher prices lacked momentum, with most actual deals concentrated at relatively low levels. Foreign trade FOB prices edged up in tandem to $2,270-2,370/mt. The current rise in both domestic and overseas prices was driven mainly by cost support from higher raw material prices. Smelters, squeezed by losses, showed a strong willingness to hold prices firm and proactively raised their quotations, rather than any substantive recovery in end-use demand. Overall demand remains weak. Downstream buyers in China are cautious, with pronounced wait-and-see sentiment. Traders are mostly offloading at lower prices and have made no moves to restock. Markets outside China are limited to small volumes of just-in-time procurement, with no increase in new orders. Scattered inquiries show clear pressure to push for lower prices, and actual foreign trade transactions remain weak. At this stage, the market is locked in a tug-of-war between cost-driven price support and weak demand follow-through. Prices lack upward momentum and room to shot up is limited. In the short term, magnesium prices are likely to continue moving sideways within a narrow range. Going forward, attention should focus on the pace of downstream restocking and production cuts at smelters.