SunSirs: There Was Not Much Inventory Pressure, and Magnesium Factories Were Reluctant to Sell (August 14-18)

Price trend

According to the monitoring of SunSirs, as of the 18th, the average market price of magnesium ingots in China was 21,966.67 RMB/ton, an increase of 0.15% on a weekly basis. At the beginning of the week, there was a slight downward trend in the magnesium ingot market. Magnesium factories started to sell at high prices, and the magnesium price once again hit the 220,00 RMB/ton mark. However, the market's high prices were weak, and the price remained stable at 21,900-22000 RMB/ton by Friday.

Analysis review

In terms of supply and demand

In terms of factories, considering the trend of inventory decline due to downstream restocking this week, and the slow resumption of production in magnesium factories, the market operating rate this week was about 47.52%. The factory had a strong willingness to raise prices, and it was difficult to find low-priced goods on the market. In terms of demand, downstream customers' inquiry and procurement activity had increased this week, but facing rising magnesium prices, traders' procurement enthusiasm had gradually decreased. In terms of overseas demand, the summer break abroad was about to end, and there may be a slight growth trend in overseas orders.

In terms of raw materials

This week, ferrosilicon futures continued to decline, with only a slight rebound on Friday, and spot prices had slightly decreased by 50-100 RMB/ton. As of August 18th, the inventory pressure of manufacturers was relatively low, and the steel bidding prices generally increased in August, while the willingness of ferrosilicon manufacturers to further reduce was relatively low. The semi-coke market was operating steadily, and currently the overall inventory of the semi-coke market was low, the market transaction was mainly stable. The prices of semi-coke in the main national markets were as follows: the mainstream prices of small and medium-sized materials in the Shenmu market were 970-1,100 RMB/ton, and the coke flour was 700-780 RMB/ton.

Market outlook

Overall, the supply side of magnesium ingots had further contracted, and under relatively low supply pressure from factories, they tended to hold a mentality of high prices and reluctance to sell. Considering the downstream wait-and-see sentiment, it is expected that magnesium price will remain stable and slightly stronger in the short term.

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