Price Trends

According to monitoring by the SunSirs Commodity Market Analysis System, the magnesium ingot market in the Shaanxi region declined last week (April 20–24). The average market price stood at 17,050 RMB/ton at the beginning of the week and fell to 16,550 RMB/ton by the end of the week, representing a decrease of 2.93%.

The following analysis focuses on fundamentals:

Supply and Demand

On the supply side, production operations at smelting enterprises in major producing regions currently remain stable. Spot inventories at these facilities are hovering at historically low levels for this time of year, leading to a widespread reluctance among firms to sell. Major mainstream smelting enterprises have significantly reduced their spot market offerings, prioritizing instead the timely fulfillment of previously signed long-term contracts. Overall, the market has not witnessed any concentrated sell-offs.

On the demand side, the characteristics of the traditional off-season for consumption have become increasingly pronounced. Demand remains persistently weak across downstream sectors—including automotive, aluminum alloys, and steel desulfurization—with end-users limiting their purchasing to small, strictly essential orders and refraining from any concentrated inventory replenishment. The export market shows no signs of a significant rebound; overseas orders have fallen short of expectations and are insufficient to offset the shortfall in domestic demand. Consequently, market trading activity remains sluggish, and a strong sentiment prevails among participants to "buy on the rise, but hold off on the decline."

Raw Materials Sector

Prices for raw materials—such as ferrosilicon and semi-coke—have remained stable but show a weakening trend, offering limited support to magnesium prices. In Fugu, the price of 75% ferrosilicon has declined since mid-week; the market remains weak, with buyers making only small, need-based purchases. Demand follow-through is lackluster, and with some enterprises resuming production, market sentiment is under pressure. However, in certain regions, spot supplies remain tight—with production running on a back-order basis—keeping raw material prices relatively firm. Consequently, manufacturers show little inclination to lower prices to push sales, with most adopting a wait-and-see approach. Ferrosilicon futures opened high but trended downward; trading activity is cautious, and with bulls and bears currently at a stalemate, the market for 75% ferrosilicon is expected to fluctuate within a narrow range in the short term. Fugu semi-coke prices remain stable for the time being; upstream raw coal prices provide steady cost support, while supply has seen a moderate increase. Downstream buyers remain cautious, resulting in a weak equilibrium between supply and demand. Compounded by sluggish demand from sectors such as ferrosilicon production, market fundamentals appear weak; consequently, semi-coke prices are likely to maintain a soft trajectory in the short term.

Market Outlook

While there is a possibility of a technical correction following the recent overselling, the scope for a rebound remains limited given the broader market context of lackluster demand and ample supply; any such recovery should be viewed merely as a weak technical bounce. Current attention must focus on two key variables: first, whether downstream sectors will engage in concentrated stockpiling ahead of the May Day holiday; and second, whether smelting enterprises in major production regions will initiate production cuts or maintenance programs—the sole critical factor capable of reversing the current short-term downward trend. Absent the materialization of such bullish catalysts, magnesium prices are highly likely to continue their downward trajectory.

SunSirs has been continuously tracking price data for over 200 commodities for nearly 20 years, please contact support@sunsirs.com for subscription.