SHANGHAI, Dec. 21 (SMM) – Supply: Total inventories were around 42,000 mt at Huangpu port, including 20,000 mt at Yuehua warehouse, 1,500 mt at Wanxiong warehouse, and 2,000 mt at Matou warehouse. Total inventories in two warehouses in Yunnan province were between 53,000 mt. Supply of low-grade silicon metal was still tight, and supply of high-grade silicon metal and chemical-grade silicon metal was stable.

Supply:

Inventories of aluminum alloy were relatively ample, reducing demand for silicon metal. Price decline in polysilicon and trichlorosilane forced producers to cut output, also reducing demand for silicon metal.

Demand:

Silicon metal market entered into low-demand period, so transactions were not optimistic in recent week. However, lower operating rates will tighten supply. Meanwhile, the cancellation of silicon metal export tariff fueled positive expectation over market outlook. Therefore, offers of low-grade silicon metal continued to advance, driving up prices of high-grade silicon metal.

Forecast:

SMM expects that mainstream traded prices at Huangpu port will be around RMB 11,600/mt for #553 silicon metal, RMB 11,800/mt for #441 silicon metal, RMB 12,000/mt for #3303 silicon metal and 13,100/mt for #2202 silicon metal in the following week.