SHANGHAI, May 9 (SMM) – Despite an approaching rainy season, operating rates across silicon metal producers in China dipped 0.05 percentage point from March to 33.2% in April and stood 1.6 percentage points lower than a year ago, as the sluggish market jeopardised production enthusiasm, showed an SMM survey.
Output of silicon metal in China amounted to 604,000 mt in the first four months of 2019, down 23% year on year.
The restart of plants in Yunnan and Sichuan this year appeared to be later than previous years, and they were unkeen about conducting maintenance or purchasing raw materials to brace for the rainy season which will begin in June.
Cash flow issues and weak silicon prices are likely to keep some plants from resuming in the rainy season.
April’s average operating rate across plants in Yunnan rose just 1 percentage point month on month and dropped 4 percentage points year on year, while the rate for plants in Sichuan stayed flat with a month ago and tumbled 7 percentage points from a year ago.
Operating rates across producers in high-power-tariff areas such as Chongqing, Guangxi, Guizhou and Hunan, and Inner Mongolia and Qinghai in the north were also down on a yearly basis.
The ore supply shortage in Xinjiang slightly worsened, and caused a major plant to cut output at the start of May. But the plant told SMM that its lower production could still meet the demand from its long-term clients, and that the ore supply issue could be resolved soon.
With the reopening of producers in Sichuan and Yunnan, the overall operating rate is expected to climb to 36% in May, still standing lower than the same period last year. Rates across plants in Xinjiang are likely to edge down on the month.
