SunSirs: Magnesium Price Falls to Annual Low at 16,000 RMB/Ton

According to China Nonferrous Metals News, following a brief rebound the week before last, the magnesium market experienced a decline followed by stabilization last week. The price of common magnesium in the Fugu region bottomed out and stabilized at the 16,000 RMB/ton mark. In the first half of the week, magnesium prices faced downward pressure and adjusted lower. As prices returned to the trough and approached buyers' psychological price levels, some downstream users released their order fulfillment and inventory replenishment demands, beginning to purchase at lower prices. Increased transaction volume on Thursday drove the magnesium market to bottom out and stabilize.

As of November 14, the mainstream ex-factory cash quotation (tax-inclusive) for 99.9% magnesium ingots in Fugu stood at ¥16,000–¥16,100/ton, down approximately ¥300/ton from the previous Friday. Other regions followed suit with adjustments. Since October, magnesium prices have faced downward pressure due to steady supply growth, early release of export demand, and supply-demand mismatches. Current prices have retreated to annual lows, essentially reverting to pre-2021 surge levels. Throughout 2024, magnesium has consistently traded below aluminum, creating a stark contrast between aluminum's “high price” and magnesium's “cost-effectiveness.” Driven by lightweighting demands, magnesium alloy consumption is expanding rapidly, heralding the quiet arrival of the “Golden Age of Magnesium.”

Industry sources indicate that downstream buyers primarily procured on-demand last week. When magnesium prices hit a low of 16,000 yuan per ton on Thursday, concentrated purchasing emerged among downstream clients.

Two key factors explain magnesium's recent downward pressure: first, concentrated supply increases; Second, severe industry “internal competition” has forced some factories facing tight capital to offer discounts early to recover funds, encountering significant challenges in the fiercely competitive market environment.

2025 marks the inaugural year of explosive magnesium alloy applications. With steady increases in magnesium ingot production and magnesium prices remaining significantly below aluminum, a promising future for magnesium is anticipated.

From a supply-demand perspective, overall magnesium demand has yet to show significant growth. With the market remaining relatively loose, a short-term rebound appears challenging. However, given that prices have fallen to annual lows, supported by costs and underlying demand, further declines are unlikely. This week, the market is expected to stabilize, with focus shifting to monitoring demand developments.

As an integrated internet platform providing benchmark prices, on November 19, the benchmark price of magnesium onSunSirs was 16,125.00 RMB/ton, a decrease of 1.23% compared with the beginning of the month (16,325.00 RMB /ton).

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Traders can price spot and contract transactions based on the pricing principle of agreed markup and pricing formula (Transaction price=SunSirs price + Markup).

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