[SMM Analysis] Tight raw materials, low inventories, antimony prices have risen 11% in one month, here are factors the market will focus on

Many minor metals performed brilliantly. Tungsten prices are firm, and some leading titanium dioxide companies have raised the prices of their main products. Antimony has also attracted a lot of attention with its 11.18% increase in the past month. What factors support the continuous rise in antimony prices, which reached new highs in recent years? What are the factors affecting the future trend of antimony prices?

The average price of 1# antimony ingot has increased by 11.18% since December 19

According to SMM antimony prices, the price has shown an overall upward trend recently. Taking the average price of SMM1# antimony ingot as an example, its average price on January 22 was reported at 89,500 yuan/ton, up by 9,000 yuan/ton, or 11.18% compared with the high point of the average price of 80,500 yuan/ton on December 19.

Recently, the domestic antimony market price has been rising significantly. Not only the price of antimony ingots has increased, but the prices of antimony products such as antimony oxide, antimony glycol and sodium pyroantimonate have also increased rapidly.

The main reasons for the rise in antimony prices are as follows:

First of all, from the perspective of inventory, the market has basically digested the existing inventory of antimony and antimony oxide, and the current antimony inventory is at a low level. Low inventories supported the rise in antimony prices.

Secondly, the overall low inventory status of the antimony market has caused many companies to start production in order to meet production needs, especially considering that logistics outages and recovery during the Chinese New Year will take a certain amount of time. Stocking up and replenishing stocks also supported the rise in antimony prices. It is worth mentioning that considering the relatively high cost of starting a kiln, photovoltaic glass factories basically stop production during the Chinese New Year, which also requires supplementation of sodium pyroantimonate, a material used as a photovoltaic glass clarifier.

Thirdly, from the supply side, the tight supply of antimony raw materials has also supported the rise in antimony prices. In 2023, the overall international market supply will be stable but weakening. The European market is subject to energy constraints, and the output of antimony products is on a downward trend. According to SMM statistics, the output of antimony ingots from January to December 2023 was 85,692.6 tons, which was basically stable and slightly increased compared with the antimony ingot output of 82,800 tons last year, with an annual month-on-month increase of 3.49%. However, antimony ingot production has clearly begun to show a downward trend from the second half of 2023. Production peaked at more than 8,000 tons in July, began to fall below the 8,000 tons production mark in August, and then gradually declined. The main factor affecting the gradual increase in the production and supply of antimony ingots in the first half of 2023 is the suspension of production due to widespread domestic infections of COVID-19 in early 2023 and the impact of the Chinese New Year in February on production. The production of antimony ingots quickly rebounded after the domestic situation returned to normal in March 2023. The main factor causing the gradual reduction in antimony ingot production and supply in the second half of 2023 is the reduction in imports of antimony raw materials from Russia, West Asia and other places, and domestic antimony mines holding back cargoes, resulting in a shortage of raw materials. Entering 2024, raw material tension caused by tight supply of antimony ore continues, supporting the rise in antimony prices.

In addition, the U.S. sanctions on Russian metals have also made some companies more cautious when purchasing raw materials to avoid affecting the sales of their own products. This has also exacerbated the tight supply of domestic antimony raw materials to a certain extent.

Market outlook

After rising by 11.18% in the past month, antimony prices hit a new high in recent years and reached the mark of 90,000 yuan/ton. As the resistance above antimony ingots changes, what are the factors that will affect the future trend of antimony ingots?

According to SMM, some market participants said that due to the recent significant rise in domestic antimony prices, although there are still many working days before the Chinese New Year, the logistics industry will gradually shut down in a few days, and heavy snowfall in some areas and other reasons will also suspend logistics. Antimony industry transactions will also be affected by then. Therefore, to a certain extent, as downstream parties will enter the traditional stocking period before the Chinese New Year at the end of January, strong purchase transactions will continue to drive the strength of domestic antimony prices. It is not ruled out that there will be replenishment activities in the downstream after the Chinese New Year. The overall antimony market in February will be relatively optimistic. However, some market participants said that as the price of antimony gradually rises, the tendency of profit-making speculative funds to be liquidated will become more and more obvious. In addition, many manufacturers’ finished products enter the market during the Chinese New Year. After the Chinese New Year, especially after the Chinese Lantern Festival, antimony prices will also face some market competition. SMM will continue to watch the terminal industry's acceptance of high antimony prices in the future, the profit-taking of market funds, and the operating rate of photovoltaic glass companies.