SHANGHAI, May. 7 (SMM) --
The rainy season that comes later compared with the previous years is expected to begin from mid-May to late June in south east China. SMM predicts that the severe drought in south west China is going to be eased to great extent as of late June, and operating rates at that region will recover rapidly by then. As power charges have lowed in Fujian and Hunan provinces previously, operating rates at local silicon metal producers were stable, and Hunan and Fujian provinces became the major spot silicon metal supplying regions in China.
Global economy gradually is recovering after the financial crisis, and industrial manufactures at various countries were recovering as well. Demand for silicon metal from downstream industries including aluminum alloy, organic silicon and polysilicon increased stably.
From late April to early May, prices of silicon metal gradually declined slightly from high levels, and a strong short position sentiment was still prevailing in the market as power charges will be lower during the high water period.
SMM believes that operating rates in south west China will not likely recover fast, and supply of spot silicon metal will still not sufficient in China. It is expected that silicon metal prices will continue to fall slightly, but enquiries from overseas purchasers will increase and transactions will be brisk.
SMM predicts that traded prices of #553 silicon metal at Huangpu port will be around RMB 12,500/mt, traded prices of #441 silicon metal will be around RMB 12,500/mt, traded prices of #3303 silicon metal will be around RMB 13,400/mt and traded prices of #2202 silicon metal will be around RMB 14,000/mt in the following week.
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