SHANGHAI, Aug 18 (SMM) — The recent torrential rains across Sichuan and areas such as Leshan, Aba and Ya’an has caused a negative impact on the production of silicon mills and polysilicon mills.
The cooling water circulation system of two metal silicon mills in Leshan and Aba, where most metal silicon manufacturers are located, has been damaged by the heavy rainfall and could not operate, and a total of three submerged arc furnaces have stopped production.
A submerged arc furnace may halt production due to a reduction of power supply at mill in Leshan, whether the mill can be restarted or not will depend on the repair progress of power supply lines.
Other silicon mills have not seen any reduction or suspension of production as of August 18, but the transportation of raw materials and finished products was hindered by heavy rain in Leshan, Aba, Ya 'an and Liangshan and other metal silicon producing areas in Sichuan to varying degrees.
The transportation of raw materials and finished products in one Aba silicon plant is also temporarily disrupted due to road damage. Delivery of cargoes are also delayed due to bad weather, and transportation cost increased slightly.
According to the weather forecast, heavy rainfall will continue in some areas of Sichuan over the next few days, and will affect the domestic supply of metal silicon due to a delay in delivery. This is especially so for enterprises outside Sichuan who can only transfer goods from neighboring production areas.
Enterprises producing chemical-grade silicon are the most seriously affected in the above-mentioned producing areas. As the most concentrated area of silicone factory procurement, it is more likely that the prices of chemical-grade silicon will rise due to the decline of supply and higher transport cost. For instance, the acceptance price for 421# silicon in Sichuan Silicon Factory was adjusted to 12,500-12,600 yuan/mt today, 500 yuan/mt higher than the beginning of the month.
Tongwei Group, the only polysilicon enterprise in Sichuan Province, has two factories located in Leshan. The factory, with an annual production capacity of 20,000 mt has stopped production at the request of the local flood control department on the morning of August 18, while another 35,000 mt production capacities were put into production as they were far away from the Minjiang river which is affected by the floods.
The previous shutdown of big mills in Xinjiang and the flood will further aggravate the tight supply of polysilicon, and the upward trend of prices will continue in the near term.