SMM analysis: Review of the market situation of silicon electrodes in 2023

The market price of silicon electrodes edged down during the year. Currently, the types of electrodes used by downstream industrial silicon manufacturers are also different according to their production and smelting habits. Small-diameter graphite electrodes are mainly used in Yunnan, carbon electrodes are mainly used in Fujian, and carbon electrodes are mainly used by silicon companies in the north-west. Most of the large silicon companies use large diameter graphite electrode. With the rapid expansion of production capacity of large silicon companies, the demand for large-diameter graphite electrodes has been positive and strong. With electrode prices generally falling in 2023, the price of large-diameter ordinary power graphite electrodes (diameter 1272mm) saw the smallest decline during the year, at 37%, while prices of ordinary power graphite electrodes (diameter 960-1100mm) fell by 50% during the year.

The size of the silicon electrode market is small, and there are few upstream and downstream price factors. The raw material end is mainly affected by the price of calcined coke, but is constrained by the long production cycle of silicon electrodes (carbon electrode production cycle is 3-4 months, graphite electrode production cycle is 5-6 months). The rising and falling prices of raw material burnt coke are difficult to quickly transmit to the downstream electrode links.

In the first half of the year, the price of burnt coke, the raw material for electrodes, was falling. Coupled with the continued downturn in the downstream industrial silicon market, the price of electrodes fluctuated and fell, especially for carbon electrodes with a single downstream channel. Price competition intensified under the background of sluggish demand.The price difference between carbon electrodes and graphite electrodes continued to widen. Starting from July, some carbon electrode manufacturers, out of cost and profit considerations, joined the graphitization process and switched to the production of graphite electrodes for silicon to avoid further losses.

In August, as the price of industrial silicon recovered, the price of calcined coke, the raw material for electrodes, also recovered slightly. Supported by the double positive price of silicon electrodes, the price of graphite electrodes finally stopped falling and recovered in late August, but the increase was very limited. Carbon electrode prices still fell slightly.

Entering the fourth quarter, beginning in October, the price of silicon electrodes began to stabilize due to multiple influences such as the continued recovery of silicon prices, the high operating rates of downstream silicon plants and the active procurement of raw materials. Beginning in November, silicon plants in the southwest region entered the dry season, with construction starts gradually declining and demand for electrode procurement gradually weakening. However, due to cost considerations, electrode prices were mostly stable.