SMM June 4 News:Silicon Metal:This week, spot silicon metal remained stagnant and consolidated. As of June 4, SMM east China oxygen-blown #553 silicon was at 9,100-9,300 yuan/mt, up 50 yuan/mt WoW; #441 silicon was at 9,300-9,400 yuan/mt, flat WoW; #421 silicon (used in silicone) was at 9,400-9,800 yuan/mt, flat WoW; #3303 silicon was at 10,100-10,300 yuan/mt, flat WoW. Futures market, the most-traded silicon metal contract held up well, with the SI2609 contract closing at 8,715 yuan/mt on Thursday, up 125 yuan/mt WoW. Silicon metal weighted open interest was at 354,000 lots, down 55,000 lots WoW; the most-traded contract open interest was at 261,000 lots, down 9,000 lots WoW. Supported by stronger coking coal prices, silicon metal futures fluctuated upward. Cost side, silicon coal rose by around 30-50 yuan/mt, slightly driving up costs for northern silicon enterprises. This week, silicon metal price center was on the stronger side, downstream wait-and-see sentiment increased, and market trading atmosphere was moderate.
Demand side, polysilicon enterprises' weekly production edged up WoW. In June, some bases in Sichuan and Inner Mongolia plan to ramp up production, and polysilicon production is expected to increase notably going forward, driving up silicon metal demand. Silicone enterprises' weekly operating rate was basically flat WoW. Under the joint emission reduction initiative, silicone industry operating rate may edge down next week; attention should be paid to subsequent actual silicone operating rate adjustments. Aluminum alloy enterprises' weekly operating rate remained weak, with primary alloy operating rate basically stable, while secondary aluminum alloy operating rate was weak, mainly because some enterprises were affected by persistent shortages of input VAT invoices, leading to increased tax burdens and compliance costs, which in turn affected normal production.
Supply side, northern silicon enterprises' operating rate was basically stable, while southwestern silicon enterprises' operating rate gradually improved. As the southwest gradually entered the rainy season with electricity prices declining, a small number of silicon enterprises resumed production or increased operations, but production release was slow. Cost side, although southwestern rainy season costs declined on a phased basis, current regional costs remained higher than those of northern operating silicon enterprises. Therefore, rising silicon coal raw material prices provided strong cost support for silicon metal on the downside, while upside prices were constrained by the supply-demand relationship. Silicon metal was in a buyer-seller standoff phase; attention should be paid to changes in market sentiment.
Polysilicon:This week, the polysilicon price index was 33.569 yuan/kg, N-type recharging polysilicon was quoted at 32.7-35.5 yuan/kg, and granular polysilicon was quoted at 33-34 yuan/kg. This week, polysilicon prices edged down. For most of the week, market transactions gradually decreased, mainly driven by order deliveries. However, affected by subsequent supply expectations and weakening downstream prices, polysilicon prices remained weak, compounded by the meeting yielding no effective outcomes, and prices showed no signs of recovery for the time being.
Wafer:Wafer prices declined this week. Specifically, N-type 183 wafer prices were at 0.88-0.9 yuan/piece, 210R wafer prices were quoted at 0.98-1.00 yuan/piece, and 210mm wafer prices were quoted at 1.18-1.2 yuan/piece. During this week's exhibition, top-tier players in the wafer segment largely reached a consensus to firmly maintain price levels, and would not rule out production cuts in response if marginal demand weakened. Going forward, if raw material prices continue to decline, yielding margin space to wafer enterprises, the wafer segment may cap profits. Overall, the need for the wafer segment to maintain both quality and price is extremely urgent. You get what you pay for—if low prices are pursued indiscriminately, the modules produced may face serious challenges in first-year degradation and subsequent operation and maintenance.
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