Price trend:

According to the commodity price analysis system of SunSirs, the magnesium ingot market in Shaanxi province fluctuated at a low level overall. The average market price at the end of the month was 16,100 MB/ton, compared to 16,325 RMB/ton at the beginning of the month, representing a monthly decrease of 1.38%.

Market Analysis

Throughout November, magnesium prices generally exhibited a narrow range of fluctuations and a slightly weak but stable trend. At the beginning of the month, magnesium prices fluctuated around 16,200 MB/ton; by mid-month, driven by rising costs and improved trading volume in some regions, prices rose slightly; however, due to the lack of sustained demand, prices fell again, approaching 16,000 MB/ton, and remained largely within this price range by the end of the month.

On the supply side, inventory levels in major production areas continued to show a tight balance, with the Fugu region being particularly prominent. Most companies in this area had achieved zero inventory management, and low-priced supplies were becoming increasingly scarce. Against this backdrop, suppliers were demonstrating a strong willingness and ability to maintain high prices due to their inventory advantage. Meanwhile, the process of capacity expansion was progressing steadily without significant acceleration, and the contribution of new capacity to market supply remained relatively limited, maintaining overall market supply at a relatively stable level.

On the demand side, traditional demand sectors were performing relatively weakly, with most downstream companies focusing on depleting existing inventory. Purchasing patterns were closely linked to price fluctuations, and there was little evidence of large-scale restocking. Demand in emerging sectors continued to grow, but the order volumes remained small, limiting their impact on short-term price increases. 

Regarding raw materials: The price of thermal coal had shown a continuous upward trend, which in turn had driven up the production cost per ton of magnesium. Under these circumstances, the pressure of losses on companies had been alleviated, and their willingness to maintain higher prices had become stronger, becoming an important force supporting the bottom price of magnesium. At the same time, the prices of raw materials such as semi-coke and ferrosilicon had remained stable, further solidifying the cost base.

Market Outlook:

In the short term, magnesium prices are expected to fluctuate slightly around the cost line, lacking significant upward momentum. However, the decline will also not be substantial. At this time, it is crucial to monitor whether there are any substantive signs of recovery in demand. Considering all factors, magnesium prices in November were influenced and constrained by both cost and demand factors, resulting in an overall weak but stable trend. For the market to break out of this current state, a substantial improvement in demand or a structural adjustment in supply is necessary.

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