This week (10.26-10.30), the magnesium ingot market in Shaanxi region fell, with an average market price of 15250 yuan/ton at the beginning of the week and 15100 yuan/ton at the end of the week, a decrease of 0.98%.
The following analysis is based on fundamentals:
Supply and demand side
Although prices on the supply side have fallen below the cost lines of some factories, there has not been a significant reduction in operating rates in the main production areas, and the market’s spot supply is still relatively sufficient. The pattern of oversupply is the core factor suppressing the price decline this week.
Downstream demand on the demand side continues to be weak, and buyers generally hold a “buy up, not buy down” mentality, mainly adopting a wait-and-see approach. The market only maintains essential purchases, and the overall trading atmosphere is light.
Raw material side
The two core raw materials for magnesium smelting, 75 silicon iron and blue charcoal, showed a differentiation pattern of “weak silicon iron, stable blue charcoal, and hard coal price” this week. As of October 30th, the price of 75% silicon iron in Shaanxi has fallen to 5900 yuan/ton, while the price of blue charcoal small materials remains stable at 1090 yuan/ton, but the price of thermal coal is still running at a high level.
integrated forecasting
The current magnesium price is in a game stage of “weak fundamentals+oversold technical aspects”. It is expected that magnesium prices will continue to seek support near the integer threshold of 15000 yuan/ton next week. If factories voluntarily reduce production due to worsening losses in the later stage, or if downstream companies start centralized inventory replenishment after oversold, magnesium prices are expected to stabilize and rebound.
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