Supply disruption and weak demand decline European Magnesium Sulphate prices in Jan 2024

In the prime month of 2024, Magnesium Sulphate prices witnessed a slight decrease of 1% in the European region amid sluggish offtakes from the buyers and the afflicted production rates due to stressed availability of feedstock Magnesium supplies.

Previously, the availability of Magnesium supplies was moderate as Chinese players did not want to sell goods at lower costs, and European buyers made their purchases cautiously. Meanwhile, in January 2024, feedstock Magnesium prices escalated in China amid increased stocking practices by Chinese players before the Lunar New Year holidays. The hike in semi-coke prices further led to an increase in the production costs of feedstock Magnesium. At the same time, supply chain disruption amid ongoing geopolitical tensions, along with increased supply concerns after a missile attack on a ship sailing through the Red Sea in the Middle East region and an increase in ship traffic on The Cape of Good Hope, resulted in affected supplies of feedstock Magnesium in Europe. It affected the production of Magnesium Sulphate.

On the contrary, the cost support was low on Magnesium Sulphate from the feedstock Sulphuric Acid amid a decrease in Sulphur costs due to the depressed demand from agrochemical industries.

Meanwhile, the procurement activities of Magnesium Sulphate were sluggish from the end-users as the demand remained moderately low for Epsom Salt from the Pharma sector and beauty & wellness industries in regional and international markets. Simultaneously, orders for Magnesium Sulphate were depressing from fertilizers amid low consumption rates from the horticulture sector as well.

The previous Magnesium Sulphate inventories were adequately available in the market as the production rates were firm in the country. During the previous month, the market did not showcase any significant improvement in inquiries amid the ongoing economic slowdown in the region. Consequently, the inventory levels of Magnesium Sulphate increased as the offtakes were low, and supplies were firm due to an increase in production rates.

According to the ChemAnalyst data sources, the Magnesium Sulphate FOB Hamburg quotations in Germany witnessed USD 2115/MT at the end of January 2024.

As per the estimation, the Magnesium Sulphate prices will increase in European months during the upcoming weeks. The reason is the delay and tight supply of feedstock Magnesium from the Asian exporters as the Chinese market will remain closed for the Lunar New Year celebration. Furthermore, the demand for Magnesium Sulphate Epsom Salt will likely improve from the agrochemical industry in the upcoming weeks with the increasing temperature in the Northern Hemisphere.