Silicon metal prices fall amid bearish sentiment, with addition drop on the way

As of October 26, prices of standard 553# silicon in East China were down 200 yuan/mt or 1% WoW at 14,400-14,500 yuan/mt, that of above-standard 553# silicon were down 100 yuan/mt or 1% WoW, at 15,100-15,200 yuan/mt, that of 441# silicon were down 100 yuan/mt or 1% WoW at 15,400-15,600 yuan/mt, that of 421# silicon metal (for silicone) were down 100 yuan/mt or 1% WoW at 16,200- 16,400 yuan/mt and that of 3303# silicon were down 100 yuan/mt or 1% WoW at 15,900-16,200 yuan/mt. Demand weakness left silicon plants with less inquiries and transactions. In addition, more downstream buyers and traders lowered prices. On October 26, silicon metal futures prices slumped. In Guangzhou, 421# silicon metal warrant prices were at premiums of 1,850 yuan/mt over closing price of the 2311 futures contract, and stood at 15,070 yuan/mt (self pick-up), basically flat with offers from silicon plants and traders for above-standard 551# silicon metal at ports. Downstream and traders showed more willingness to buy warrants. Silicon plants were inclined to sell off. Bearish sentiment permeated silicon market.

A stark futures price fall gave participants some jitters. There was a small amount of supply whose prices were 200-300 yuan/mt lower than offers from major silicon plants. In addition, a slew of cancelled warrants will pile pressure on market supply in November. In a word, short-term silicon prices may creep down to a certain extent.