SHANGHAI, Feb. 18 (SMM) --
Operating rates at silicon metal producers will not improve significantly in the short term. Producers in Hunan producing #553 silicon metal will gradually resume operation from March and April, and producers in Hunan will resume production from April or May due to lack of water and electricity.
Given that domestic and overseas producers have certain inventories, most of purchasers wait for price movement in March when producers resume production and purchasing interest was weak.
Production costs at silicon metal producers increased after the Chinese New Year holiday, as producers in Unman province are required to pay for electricity prices in every ten days, fueling cash flow pressures at silicon metal producers. In this context, producers will not intentionally stockpile stocks. Downstream demand was sluggish, SMM expects that silicon metal prices will fall when supply increases in March. SMM expects that trading sentiment will improve to certain extent in the following week, but prices will remain flat from last Friday's level.
SMM expects that mainstream traded prices will be around RMB 14,000/tm for #553 silicon metal at Huangpu port, RMB 14,800/tm for #441 silicon metal, RMB 15,300/tm for #3303 silicon metal and 16,200/tm for #2202 silicon metal.
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