Manufacturers were reluctant to sell and traders were in a strong wait-and-see mood.

Demand usually picks up during the Indian festivals of Dussehra and Diwali, which is celebrated in October and November, respectively.

Chinese magnesium metal prices have rebounded following a fall earlier this week as producers raised their offer prices in response to tighter spot availability.

China's August output reached 233,300t, up by 7.56pc from July, according to data from the China Nonferrous Metals Industry Association.

The spread is over four times as wide as the $326/st from a year ago.

The tone of steel bidding in September was established last Friday with the bidding price of HBIS Group at 10700 yuan per ton.

More buying interest from steelmakers is expected in the next few weeks and there should be an increase in inter-merchant trading in that time.

No firm date was given for the introduction of the planned changes.