Orders Sluggish and Supply Under Pressure, Silicon Metal Prices Show Weak Trend [SMM Silicon Industry Weekly Review]

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SMM, February 27: Silicon Metal:

This week, the mainstream transaction center of spot silicon metal prices showed a downward trend. As of February 27, above-standard #553 silicon in east China was priced at 10,600-10,700 yuan/mt, down 150 yuan/mt WoW; #441 silicon was priced at 11,000-11,200 yuan/mt, down 100 yuan/mt WoW; #421 silicon was priced at 11,300-11,600 yuan/mt, down 150 yuan/mt WoW; #421 silicon (for silicone) was priced at 11,900-12,300 yuan/mt, down 50 yuan/mt WoW. In the futures market, the Si2505 contract fluctuated downward within the range of 10,280-10,550 yuan/mt during the week, closing at 10,330 yuan/mt on Thursday afternoon. The decline in silicon metal futures enhanced the liquidity of spot cargoes. Meanwhile, the release of actual orders from downstream silicon sectors remained limited, and silicon enterprises faced difficulties in concluding transactions after quoting externally. Some silicon enterprises adjusted their actual order prices downward with concessions, leading to a weaker transaction center in the silicon metal market.

On the demand side, the operating rate of polysilicon enterprises remained basically stable during the week and has also been stable in recent weeks, keeping the demand for silicon metal steady. The industrial silicon capacity supporting polysilicon enterprises is gradually coming online, with expectations of further weakening in external purchase volumes in the future. The operating rate of silicone enterprises increased slightly WoW during the week but remained below conventional levels overall. Silicone enterprises collectively maintained a sentiment to stand firm on quotes, with DMC prices continuing to fluctuate upward. Coupled with the low prices of raw material #421 silicon, the profitability of silicone monomer plant enterprises improved, but their procurement of raw silicon metal remained on an as-needed basis. The operating rate of aluminum-silicon alloy enterprises saw a slight increase during the week. Some aluminum-silicon alloy enterprises focused on consuming pre-holiday stockpiles, while others mainly purchased spot orders as needed. The demand for silicon metal from aluminum alloy in March is expected to improve.

On the supply side, the overall operating rate of silicon metal continued to increase. With the gradual release of production from newly restarted submerged arc furnaces, the national supply of silicon metal in March is expected to increase. From a supply-demand perspective, short-term spot prices remain under pressure, and the industry's inventory cannot be effectively reduced, leading to a pessimistic market sentiment. In the short term, spot silicon metal prices are expected to fluctuate downward.

Polysilicon:

Polysilicon: This week, the mainstream transaction price of N-type recharging polysilicon was 39-45 yuan/kg, and the mainstream transaction price of N-type dense polysilicon was 38-42 yuan/kg. Polysilicon transaction prices remained stable this week. In March, wafer production schedules were limited due to self-regulation, and market sentiment was relatively stable. From the supply-demand balance in March, polysilicon supply and demand were tightly balanced. Polysilicon still had certain inventory levels, and prices remained stable. Some enterprises intended to stand firm on quotes, but no actual implementation has been observed yet.

Wafers: This week, domestic N-type 18Xmm wafers were priced at 1.18-1.2 yuan/piece, N-type 210R wafers at 1.26-1.35 yuan/piece, and N-type 210mm wafers at 1.55-1.6 yuan/piece. Wafer prices increased this week, mainly due to collective price hikes by top-tier enterprises. It is understood that the new prices will take effect next week. Additionally, some enterprises with previously low prices began to adjust their wafer quotes upward this week. In March, wafer production schedules were slightly insufficient relative to battery demand. Combined with the market sentiment boost in the earlier period and the anticipated demand over the next 2-3 months, this round of price increases occurred.

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