Weekly Review and Forecast on China's Silicon Market-Shanghai Metals Market

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Weekly Review and Forecast on China's Silicon Market

SMM Insight 07:13:07PM Mar 19, 2010 Source:SMM

SHANGHAI, Mar. 19 (SMM) --

Weekly Review

This week, prices to port of silicon metal advanced slightly, actual traded prices of #553 stabilized above RMB 12,000/mt as producers were unwilling to sign contract with prices below RMB 12,000/mt, and mainstream traded prices were in the RMB 12,000-12,200/mt range. Mainstream traded prices of #441 also advanced by RMB 100/mt to RMB 12,700-12,900/mt. and prices of #3303 and #2202 were relatively stable, with prices between RMB 13,000-13,200/mt and between RMB 14,000-14,200/mt respectively.

On Friday, inventories in Hongkai and Xuehua ports were 7,200 mt and 5,600 mt respectively. Shipping volumes of goods didn't increase much, and inventories remained flat from last week.

Weekly Forecast

Supply

Operating rates decline in Guizhou province this week, but operating rates grow in Hunan province, resulting in relatively stale operating rates in China. Currently, market players pay close attention on adjustment of electricity prices. Although production capacity of silicon only accounts for 10% of China's total capacity, current supply of silicon is mainly from Hunan and Fujian provinces. In this context, silicon prices in Hunan province will have great impact on the China's domestic silicon prices.

Demand

Purchasing volumes form domestic downstream silicon powder producers are stable and operating rates at aluminum alloy producers, especially from producers with small capacity, gradually grow. In addition, exporting market also improve and is expected to improve further in the following week. Inquiries from South Korea increase, boosting confidence on recovery of exporting market. Steady climbing silicon prices offered from China are gradually accepted by purchasers in South Korea, and purchasers from South Korea have changed their expectation of lower prices during the high water period due to sustainable drought in Southeast China. However, purchasing volumes from South Korea are not high, and purchasers from Japan still adopt a wait-and-see attitude in general.

Summary

SMM believes that silicon metal prices will mainly remain flat in the short term, and prices will fluctuate narrowly. On one hand, rising momentum of silicon prices will be limited as export market hasn't improved substantially. On the other hand, although electricity prices in Hunan and Fujian provinces are expected to slip, the decline range will be very limit, resulting limited decline of silicon prices. It is expected that #553 and #2202 will move in the RMB 12,100-14,200/mt next week.

To contact the writer on this report: xiangyu@smm.cn

 

Copyright © SMM. All Rights Reserved

None of this material may be used for any commercial or public use in any forms or means, without the prior written consent of SMM. For reproduction issue, please contact us by email: service.en@smm.cn

 

Weekly Review and Forecast on China's Silicon Market

SMM Insight 07:13:07PM Mar 19, 2010 Source:SMM

SHANGHAI, Mar. 19 (SMM) --

Weekly Review

This week, prices to port of silicon metal advanced slightly, actual traded prices of #553 stabilized above RMB 12,000/mt as producers were unwilling to sign contract with prices below RMB 12,000/mt, and mainstream traded prices were in the RMB 12,000-12,200/mt range. Mainstream traded prices of #441 also advanced by RMB 100/mt to RMB 12,700-12,900/mt. and prices of #3303 and #2202 were relatively stable, with prices between RMB 13,000-13,200/mt and between RMB 14,000-14,200/mt respectively.

On Friday, inventories in Hongkai and Xuehua ports were 7,200 mt and 5,600 mt respectively. Shipping volumes of goods didn't increase much, and inventories remained flat from last week.

Weekly Forecast

Supply

Operating rates decline in Guizhou province this week, but operating rates grow in Hunan province, resulting in relatively stale operating rates in China. Currently, market players pay close attention on adjustment of electricity prices. Although production capacity of silicon only accounts for 10% of China's total capacity, current supply of silicon is mainly from Hunan and Fujian provinces. In this context, silicon prices in Hunan province will have great impact on the China's domestic silicon prices.

Demand

Purchasing volumes form domestic downstream silicon powder producers are stable and operating rates at aluminum alloy producers, especially from producers with small capacity, gradually grow. In addition, exporting market also improve and is expected to improve further in the following week. Inquiries from South Korea increase, boosting confidence on recovery of exporting market. Steady climbing silicon prices offered from China are gradually accepted by purchasers in South Korea, and purchasers from South Korea have changed their expectation of lower prices during the high water period due to sustainable drought in Southeast China. However, purchasing volumes from South Korea are not high, and purchasers from Japan still adopt a wait-and-see attitude in general.

Summary

SMM believes that silicon metal prices will mainly remain flat in the short term, and prices will fluctuate narrowly. On one hand, rising momentum of silicon prices will be limited as export market hasn't improved substantially. On the other hand, although electricity prices in Hunan and Fujian provinces are expected to slip, the decline range will be very limit, resulting limited decline of silicon prices. It is expected that #553 and #2202 will move in the RMB 12,100-14,200/mt next week.

To contact the writer on this report: xiangyu@smm.cn

 

Copyright © SMM. All Rights Reserved

None of this material may be used for any commercial or public use in any forms or means, without the prior written consent of SMM. For reproduction issue, please contact us by email: service.en@smm.cn