Most-Traded Silicon Futures Contract Hits New Low Again, Silicon Companies' Quotes Struggle to Follow [SMM Weekly Review]

This week, the spot price of industrial silicon showed a weak consolidation. Today, in east China, non-oxygenated 553# silicon was priced at 11,300-11,500 yuan/mt, down 150 yuan/mt WoW; oxygenated 553# silicon was priced at 11,400-11,600 yuan/mt, down 200 yuan/mt WoW; 421# silicon was priced at 12,000-12,100 yuan/mt, down 200 yuan/mt WoW; and 421# silicon (for silicone use) was priced at 12,400-12,800 yuan/mt, down 200 yuan/mt WoW. The SI2409 industrial silicon futures contract continued to decline this Wednesday, hitting a low of 9,165 yuan/mt. The rapid decline in futures prices has led to widespread losses among silicon companies, except for the leading enterprises, making it difficult for silicon companies to follow the price drop.

On the demand side, the operating rate of the polysilicon industry slightly increased, mainly due to the recent production increase driven by granular silicon companies. The operating rate of the silicone industry remained stable. Although the price of 421# silicon in the spot market is low enough, the uncertainty in product quality has led to fewer silicone factories taking delivery from the market. Recently, the price spread between regular 421# silicon and low-titanium 421# silicon has shown a widening trend. The operating rate of the aluminum alloy industry remained basically stable, with alloy factories mainly replenishing inventory as needed.

In the past two weeks, the rapid decline in silicon prices has led to poor sentiment among silicon companies, with many experiencing losses. Even with further price concessions, transaction conditions may not be ideal, leading to many silicon factories being unwilling to quote or quoting erratically. Coupled with the leading enterprises' intention to support prices, it is expected that the decline in industrial silicon spot prices will narrow and stabilize.