SHANGHAI, Oct 17 (SMM) – Operating rates across domestic silicon plants picked up in September as production resumed in Yunnan, Inner Mongolia, Chongqing, and Hunan after maintenance.
The rate came in at 56.1% in September, up 4.3 percentage points from August and up 6.8 percentage points from a year ago, SMM research found. Production of silicon metal stood at 269,000 mt last month, up 2.4% from August and up 11.5% from last year. This brought silicon output in January-September 17.7% higher from 2017, standing at 2.023 million mt.
Production costs at silicon plants in southern areas such as Sichuan province and Nujiang of Yunnan province will rise in the upcoming dry season in November, when electricity prices will be raised by 0.05-0.06 yuan/kWh. Higher electricity fees will push some plants into suspension as they already faced lower efficiency and equipment issues after four consecutive months of production.
Unlike previous years, power shortages occurred across industrial users in hydropower-rich areas of Sichuan and Chongqing from the start of this year. Emerging virtual currency mining machines consumed much electricity, and this accounted for the tight supplies of energy for traditional industries in the rainy season.
Dehong area of Yunnan plans to raise electricity prices in early November, nearly a month earlier from previous years. Almost half of the local silicon plants will cut production or suspend when higher prices set in. SMM expects the operating rate of silicon producers will dip to 55% in October.
