SHANGHAI, Feb 12 (SMM) – Operation across Chinese silicon producers further declined in January due to tighter power supply amid a dry season in Sichuan and Yunnan and maintenance at some plants in Guizhou, Guangxi, Hunan and Inner Mongolia.

Operating rates across silicon metal producers in China averaged 33.7% in January, down 1.2 percentage points on the month and 2.2 percentage points on the year, an SMM survey showed. The rate dropped 15.6 percentage points from November to 35% in December.

A large plant in Xinjiang slowed operation by 25% in the second half of January as workers left for Chinese New Year (CNY). The average operating rate across silicon producers in Xinjiang lost 8.5 percentage points last month.

Silicon plants that maintained production all year around usually undertook maintenance ahead of the CNY break. This, together with a labour shortage, accounted for the low operating rates.

Thin profit margins from lower silicon prices further eroded production enthusiasm among silicon plants.

Silicon producers are likely to return from the CNY holiday at the end of February at the soonest. SMM expects the average operating rate across Chinese silicon metal producers to stay at 33% in February.