SHANGHAI, Jun. 1 (SMM) -- Enquires were sluggish at China's domestic spot silicon metal market on June 1st with weak demand and overall sluggish transactions reported in the market. SMM latest mainstream offers at Huangpu port were between RMB 11,300-11,600/mt for #553 silicon metal, between RMB 12,000-12,400/mt for #441 silicon metal, between RMB 12,800-13,200/mt for #3303 silicon metal, and between RMB 13,700-14,100/mt for #2202 silicon metal.
Electricity prices were adjusted from low-water period standard of more than RMB 0.45 kWh into high-water period standard around RMB 0.35/kWh in Dehong and Baoshan regions of Yunnan province. As operating rates at local silicon metal producers were recovering at a better-than-expected pace, market supply is bound to grow sustainably, resulting in significant decline of high grade #3303 and #2202 silicon metal prices in Kunming. High-water period electricity prices will also be executed in Guizhou province in June, and market players estimated that electricity prices will be adjusted from RMB 0.56/kWh into approximately RMB 0.445/kWh. The decline of electricity prices in Guizhou will also propel quick production resumption at that region, and supply of low grade #553 and #441 silicon metal will continue to be in surplus. SMM believes that the recent sluggish downstream consumption as well as expectation of severe overcapacity of China's domestic spot silicon metal will continue to drag down silicon prices, and prices of #553 silicon metal will test the supporting level of RMB 11,000/mt.
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