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SMM Exclusive: China Metals Output In February And Forecast For March

iconMar 12, 2024 13:40
SMM data showed that China's copper cathode output in February was 950,300 mt, a month-on-month decrease of 19,500 mt or 2.01%, but a year-on-year increase of 4.68%.

SMM Exclusive: China Metals Output In February And Forecast For March

Copper cathode

SMM data showed that China's copper cathode output in February was 950,300 mt, a month-on-month decrease of 19,500 mt or 2.01%, but a year-on-year increase of 4.68%. Output decreased 9,100 mt from the expected 959,400 mt. The cumulative output from January to February was 1.9201 million mt, an increase of 159,000 mt or 9.03% year-on-year.

There are several reasons for the unexpected decline in output in February: 1. Affected by the continued decline in copper concentrate TCs (as of March 1, the SMM imported copper concentrate TC index (weekly) was reported at $16.41/mt, a decrease of $7.09/mt from a week earlier, a new low in recent years. If the smelters purchase spot copper concentrate for production, the current loss is 1,417 yuan/mt; if the smelters use copper concentrate under long-term contracts for production, the current profit is 918 yuan/mt). Some smelters have lowered the input amount, reducing output. 2. A smelter in south-west China began to relocate, causing its output to drop significantly; 3. Some smelters reduced their operating rates during the Chinese New Year holiday. We believe that the average operating rate of copper cathode industry fell 1.38 percentage points month on month to 83.80% in February.

In March, only one smelter has overhaul plan, and another has postponed its overhaul until April. According to our survey, as of the beginning of March, eight smelters had reduced their raw material inputs, but that had not affected their output for the time being. Despite this, the total output in March still increased slightly compared with February. The main reasons are as follows: 1. In March, various smelters increased their production after the Chinese New Year holiday, and the number of production days also increased; 2. The two smelters that were put into operation at the end of last year continued to yield output; 3. After a smelter completely stopped production, most of its blister copper and anode plates were sold, which to a certain extent alleviated the shortage of raw materials for other smelters.

Based on the production schedules of various companies, SMM estimates that domestic copper cathode output in March will be 970,200 mt, a month-on-month increase of 19,900 mt or 2.09%, and a year-on-year increase of 18,800 mt or 1.98%. The cumulative output from January to March is expected to be 2.89 million mt, a year-on-year increase of 6.55% or 177,800 mt. However, this data should be the highest value in the first half of the year. In the second quarter, smelters will enter a period of intensive maintenance. According to our current survey, 7 smelters will be overhauled in April, involving a smelting capacity of 1.21 million mt. There are 8 smelters that need to be overhauled, involving a rough refining capacity of 1.84 million mt. In June, there will be 8 smelters that need to be overhauled, involving a smelting capacity of 1.56 million mt.


According to SMM statistics, China's aluminium output was 3.333 million mt in February (29 days), up 7.81% YoY. The domestic daily average aluminium output were flat MoM at 114,900 mt. In February, downstream aluminum processing companies closed or reduced production due to CNY holidays. The share of aluminium liquid output fell by 6.1% MoM but rose by 1.6 % YoY to about 64.29%. According to SMM aluminium liquid ratio data, the domestic aluminium ingot volume in February rose by 3.21% YoY to around 1.19 million mt.

Changes in production capacity: In February, domestic aluminium smelters maintained steady operations. An aluminium smelter in Inner Mongolia was still resuming production after power outage forced it to shut down, which is expected to affect the output in March. There are no other large-scale production suspensions or resumptions. As of the end of February, the existing aluminium capacity was about 45.19 million mt, the operating aluminium capacity was around 41.99 million mt, and the operating rate grew by 4.8% YoY to 92.9%.

Output forecast: In March 2024, domestic aluminum smelters mostly maintained stable operations. A smelter in Inner Mongolia (operating capacity 860,000 mt/year) was still resuming production after power outage forced it to shut down, which is expected to affect the output. An aluminum plant in Sichuan (existing capacity of 125,000 mt/year) planned to shut down for technical transformation on March 10. The potlines will be closed by the end of March. Before the technical transformation, the company's operating capacity was approximately 65,000 mt, and the technical transformation was expected to be completed in September. In addition, Yunnan is still in the dry season. The local government encouraged industries to use more electricity and provided high-priced electricity. However, no implementation documents have been issued yet. Enterprises are estimating costs and may resume a small amount of production if a clear document is issued. SMM predicts domestic aluminum operating capacity may fall slightly to 42.09 million mt in March. The daily domestic aluminum production may inch lower. The total domestic aluminum production in March (31 days) is expected to be around 3.55 million mt, up 4.0% YoY. With the arrival of the traditional peak seasons, domestic demand gradually recovered, the production of aluminum downstream processing enterprises were stable, and the amount of aluminium ingot produced returned to normal. The share of aluminium liquid output in March may rebound to above 70%, up 6% YoY.


SMM data showed that China’s metallurgical-grade alumina output stood at 6.262 million mt in February (29 days), and the daily average output was 215,900 mt/day, down 900 mt/day MoM. The total output in February was down by 6.8% MoM but up by 2.4% YoY. As of the end of February, the existing alumina capacity in China was 100 million mt, the operating capacity was 78.82 million mt, and the average operating rate stood at 78.8%.

Operating rate in Shanxi (+1.3% MoM to 68%): The growth was mainly contributed by a refinery, who returned to full production in late February after being plagued by insufficient ore. Operating rate in Henan (-1.7% MoM to 55%): The governments of Shanxi and Henan issued documents pertaining to mining layout in February, sparking a glimmer of hope that local mines might be able to re-open. Yet, there have been no news about local mines resuming production as of now, and ore supply crunch has continued to impede production of local alumina refineries. Operating rate in Guizhou (-10.8% MoM to 75.2%): Several refineries shut down in early February for CNY holidays, involving annual capacity of 600,000 mt, and will delay restarts to mid-March.Operating rate in Hebei (+5.5% MoM to 93.8%): Most refineries maintained stable production and some reached full production in late February.Operating rate in Guangxi (-1.8% MoM to 82.3%): Several refineries cut output in February due to ore shortages, affecting 500,000 mt of capacity.Operating rate in Shandong (+0.6% MoM to 95.8%): Refineries maintained high operating rates amid high profits.

March forecast: Bauxite mines in Shanxi and Henan have no plans for immediate production resumptions, and production resumptions at local alumina refineries are proceeding slowly. A refinery in Guizhou, which halted production due to mine shutdown, will delay production restarts to mid-March, involving 600,000 year/mt of capacity. Another refinery in Guangxi, who shut down 500,000 mt of capacity earlier due to ore shortages, is now planning for restarts in late March. Taken all together, SMM sees China’s daily average alumina output at 217,500 mt in March and total operating capacity at 79.37 million mt, up 1.48%.

Overseas aluminum

According to SMM statistics, overseas aluminium output was 2.366 million mt in February (29 days), flat YoY. From January to February, output rose by 0.1% YoY to 4,899,000 mt. The current overseas aluminum production capacity utilization rate is 87.6%, down 0.2% MoM but up 1.1% YoY.

The output in South America stood at 112,000 mt in February, up 3.7% YoY, mainly as Alcoa's Alumar plant in Brazil is still restarting. The factory announced to restart in September 2021, with an annual output of around 238,000 mt in 2023, and a capacity utilization rate of approximately 53%. In 2023, the restart pushed up production by 5%. SMM expects the factory to continue the restart in 2024 to further increase capacity utilization rate.

Russia's aluminum production was 326,000 mt, up 2.2% YoY, due to the restart of UC Rusal's Taishet smelter. The smelter restarted in the first quarter of 2022, but the process was relatively slow, and the capacity utilization rate returned to about 37% in December 2023. SMM expects that the plant will continue to resume production in 2024.In February, the estimated output was 20,000 mt.

The output in Europe (excluding Russia) stood at 295,000 mt in February, down 2.2% YoY, mainly due to the shutdown of Neuss smelter in Germany. The factory announced the production suspension in March 2023. The factory produced 120,000 mt of aluminum in 2022.

Smelters in other regions maintained steady operation.

March forecast: Overseas aluminum production is expected to remain stable. Total overseas production in March is expected to be 2.524 million mt, down 0.1% YoY. In addition, New Madrid aluminum plant in the United States announced its closure in January 2024. SMM expects that it will completely stop production in March, the capacity utilization rate in North America will decrease by about 1.1% MoM, and the output will decrease by 1.7% YoY to 330,000 mt. In Australia, the operating rate of Boyne Island smelter has been rising steadily since 2022, so SMM expects the plant's capacity utilization rate will increase by 5% YoY to 92%. The production in Oceania is expected to increase by 2.3% YoY to 164,000 mt.

(Note: as 2024 is a leap year, average output was used when calculating YoY output.)

Primary lead

In February 2024, the domestic refined lead output was 276,100 mt, down 5.94% month-on-month and 2.91% year-on-year. The cumulative output from January to February was flat year-on-year. Production capacities of enterprises involved in the survey totalled 6.0063 million mt in 2024.

According to survey, the domestic refined lead production dropped as expected in February. The main reason is that February coincides with the Chinese New Year holiday. Although most primary lead smelting companies continued to produce as usual, some small and medium-sized smelting companies in Hunan and Henan closed or carried out maintenance during the Chinese New Year holiday. The output of lead smelters shrank in February due to the reduction of working days. In addition, smelting companies in Qinghai suspended production and were undergoing reconstruction and expansion, which is expected to last until September this year, resulting in a larger reduction in production. Therefore, the decline in refined lead production in February was higher than expected.

In March, there will be 31 calendar days, and the production of lead smelters will thus increase. At the same time, the maintenance of lead smelters in Hunan, Yunnan, Henan, Guangdong and other regions has been completed. These will account for the output growth in March. Large-scale delivery brands producers in Henan and some smelters in Hunan plan to undertake maintenance, which will limit the growth of refined lead production in March. SMM expects refined lead production to increase by more than 10,000 mt in March to 287,000 mt.

Secondary lead

The output of secondary lead in February 2024 was 211,300 mt, a decrease of 33.78% from January and a decrease of 33.32% year-on-year. The cumulative output of secondary lead from January to February 2024 was 530,400 mt, a decrease of 15.61% year-on-year. The output of secondary refined lead in February 2024 was 172,600 mt, a decrease of 36.47% from January and a decrease of 37.85% year-on-year. The cumulative output of secondary refined lead from January to February 2024 was 444,300 mt, a decrease of 18.64% year-on-year.

In January 2024, some secondary lead smelters were still affected by environmental protection controls at the beginning of the month. Several secondary lead smelters in Anhui experienced significant output reductions. In addition, in mid-January, downstream battery manufacturers and secondary lead smelters focused on pre-holiday raw material storage. The demand for battery scrap is large and the price of electric vehicle battery scrap once again exceeded 10,000 yuan/mt; in late January, downstream battery companies completed restocking and closed for holidays. The lack of consumption dragged down lead prices. Secondary lead companies were facing high costs and low finished product prices. Therefore, many smelters suspended production for holidays or maintenance.

In February, fewer calendar days and the Chinese New Year holidays lowered the output of secondary lead. As the lead price fluctuated within a narrow range below 16,000 yuan/mt in mid-to-late February, secondary lead smelters that were closed during the Chinese New Year holiday delayed the resumption of production; therefore, the increase in secondary lead supply was seen in mid-to-late March. According to survey, SMM predicts that the output of secondary refined lead may increase by 127,500 mt to 300,100 mt in March.

Refined zinc

In February 2024, China's refined zinc output was 502,500 mt, a month-on-month decrease of 64,400 mt or 11.36%, and a year-on-year increase of 0.22%. The cumulative output from January to February was 1.069 million mt, a year-on-year increase of 5.61%, slightly lower than expected. In February, domestic zinc alloy output was 95,300 mt, a decrease of 14,350 mt from the previous month.

In February, the output of domestic smelters dropped significantly. During the Chinese New Year holiday, smelters closed for maintenance. Moreover, zinc concentrate raw materials were tight after the holiday, thus some companies delayed their resumption of production. The number of calendar days decreased by 2 days, lowering the output. The main output reductions were concentrated in Hunan, Sichuan, Shaanxi and Guangdong.

SMM predicts that domestic refined zinc production in March 2024 will increase by 5,300 mt from the previous month to 507,900 mt, a year-on-year decrease of 8.78%, and the cumulative output from January to March will be 1.577 million mt. Production increased slightly in March, mainly due to the increase in production days in March, and the recovery of production of some companies in Sichuan after the holidays and the increase in production in Anhui and Hunan. But output in Hunan, Sichuan, Guangxi, Liaoning, Qinghai and other places dropped significantly due to maintenance. The overall output did not change much.

Refined tin

According to SMM research, domestic refined tin production in February was 11,460 mt, down 25.54% MoM and 10.41% YoY. Domestic tin ingot production nosedived in February. In Yunnan, some smelters were closed for the CNY holidays, largely lowering operating rates, while some kept stable production. In Jiangxi, there was shutdown of most smelters for maintenance during the holidays. In Inner Mongolia, a smelter steadily carried out production plan in February. In Guangdong, a smelter resumed operation recently from shutdown during the holidays. In Anhui and other regions, most smelters suspended production for two to three weeks in February. Entering March, In Yunnan, most smelters have resumed production. In Jiangxi, the end of maintenance of most smelters may add refined tin output somewhat in March. In Hubei, raw material shortage tipped a smelter into shutdown since October 2023. In other regions, most smelters resumed production after the holidays. Domestic tin ingot production is estimated to be 15,560 mt in March 2024, up 35.78% MoM and 2.95 YoY.

Refined nickel

Chinese refined nickel output in February totalled 24,600 mt (-3% MoM as expected, +42.2% YoY). Overall operating rates remained high in February, falling a paltry 2% MoM. It is estimated that Chinese refined nickel output will be 25,000 mt in March 2024.

According to SMM research, sustained nickel price rise will keep refined nickel plants’ production enthusiasm. Moreover, capacity at some refined nickel plants is still in ramp-up However, surging raw material prices made it tough for some refined nickel plants to source feedstock, slightly cutting refined nickel output. Refined nickel output in March 2024 may hike by 1.6% MoM.


China’NPI output in February was 26,100 mt in nickel content, 681,000 mt in physical content (+5.18% MoM) and a monthly drop of 8.04% in metal content. Production resumption from maintenance pushed up 200-series output of some integrated stainless steel mills in China, adding low-grade NPI output. A monthly drop in metal content was due to the CNY holidays and scheduled maintenance of high-grade NPI. Lower-than-expected RKAB approval and insufficient nickel ore supply in Indonesia lifted nickel ore prices in Philippine in February. Losses of high-grade NPI producers and no steep price hike pressed NPI output in China.

It is estimated that China’s NPI output in March 2024 will be 25,900 in nickel content, down 0.92% MoM. According to SMM research, most domestic producers suffered losses, and some cut productions in February, and may suspend production in March.

Indonesia NPI

NPI output in Indonesia in February was 113,900 mt in nickel content (-6.58% MoM as expected, +13.2% YoY), with YTD output being 235,800 mt in nickel content, up 16.6% YoY. Slow RKAB approval at Indonesian mines made most NPI plants pessimistic, pushing down their operating rates, and some lowered the operating rates by 10-20%. Estimates of high-grade NPI output will be 119,400 in nickel content in March, up 4.83% MoM. According to SMM research, acceleration of RKAB approval for Indonesian nickel ore may ease nickel ore supply crunch in late March. In addition, there was start-up of some production lines since February. NPI output may climb in March.

Nickel sulphate

China's nickel sulphate production in February 2024 was 25,600 mt in metal content and 116,600 mt in physical content, down 27.2% MoM and 17.83% YoY, mainly due to some producers taking holidays during the Spring Festival. In March, with de-stocking by the ternary materials supply chain and optimism about vehicle sales, demand looks set to rise. As nickel salt plants resume post-holiday operations, an increase in March production is expected. Yet, with high raw material costs and a slow recovery in recycling plants, nickel sulphate's projected output is 30,700 mt in metal content and 139,500 mt in physical content, up 19.66% MoM but down 17.83% YoY. March 2024 production is still anticipated to be lower than January 2024 levels.

Battery-grade manganese sulphate

Chinese high purity manganese sulphate output was 8,800 mt in February 2024, down 46.34% MoM. Most high purity manganese sulphate producers carried out maintenance during the holidays, and resumed production late. On the demand side, some precursor companies moving February production forward to January due to the CNY holidays lessened high purity manganese sulphate demand in February. Meanwhile, some integrated manganese salt precursor enterprises produced less high-purity manganese sulphate than in January.

Entering March, with restart of most plants from maintenance, ample overseas orders for ternary cathode precursor and more manganese sulphate output of integrated manganese salt precursor enterprises, high-purity manganese sulphate is expected to increase by 59.09% MoM to approximately 14,000 mt in physical content in March.


SMM data showed that Chinese EMD output in February was 13,100 mt (including 800 mt for LMO battery, 8,600 mt for alkaline manganese battery, and 3,700 mt for zinc-carbon battery), down 14.67% MoM and 20.5% YoY. The output of EMD for LMO battery and alkaline manganese battery changed little, while that for zinc-carbon battery dropped. On the demand side, primary battery companies had no orders after pre-holiday stockpiling. LMO market improved mildly after the holidays, bringing some demand. On the supply side, EMD focused on destocking in slack season of February.

Heading into March, given that Q1 is often the off-season for primary battery demand, most small and medium-sized EMD makers will keep output unchanged, while large ones will still increase production schedules in March. Among them, LMO battery output will hike the most amid market improvement. EMD output in March is estimated to be 15,200 mt.


SMM data showed that Chinese Mn3O4 output in February was 6,400 mt (including 3,300 mt of electronics-grade Mn3O4 and 3,100 mt of battery-grade one), down 36.32% MoM and 50.58% YoY. The output of the two both dipped. With the end of pre-holiday stockpiling, LMO makers slowed procurement of battery-grade Mn3O4 after the holidays. Electronics-grade Mn3O4 also saw muted demand. Therefore, Mn3O4 plants took holidays, reducing production scheduling.

In March, stronger-than-expected LMO market will accelerate battery-grade Mn3O4 demand hike. A rise in electronics-grade Mn3O4output will appear, but will still far lower than that of battery-grade one. Overall Mn3O4 output may be 9,600 mt in March.

High-carbon ferrochrome

SMM data showed that high-carbon ferrochrome output in China was 591,800 mt in February, down 43,800 mt or 6.89% MoM, but up 46,300 mt or 8.49% YoY. Among them, the output in Inner Mongolia was 438,400 mt, down 23,200 mt or 5.03% MoM, while that in Guizhou was 17,500 mt, down 40.68% MoM. Bid prices from stainless steel mills were flat in February. Losses amid higher chrome ore prices left ferrochrome plants with low willingness of production. In addition, some plants took holidays. Overall ferrochrome output shrank in February.

High-carbon ferrochrome in March may be 621,700 mt, higher than in February. In spite of flat bid prices, stainless steel mills largely increase scheduled production, fuelling higher ferrochrome demand than expected. Moreover, there will be restart of some ferrochrome plants. Operating rates of ferrochrome plants will hike in March.

Stainless steel

According to SMM survey, Chinese stainless steel output in February totalled 2.6077 million mt, up 24.57% MoM but down 7.81% YoY. These are productions by product and their changes: 200 series (709,000 mt, +3.2% MoM, -21.57% YoY); 300 series (1.394 million mt, -11.82% MoM, +5.44% YoY); 400 series (504,700 mt, -19.24% MoM, +12.03% YoY). In addition, Indonesian stainless steel production aggregated 425,000 mt in February, up 11.84% MoM and 51.79% YoY.

In February, there was maintenance of some stainless steel mills and production cuts of state-owned ones during the Chinese New Year holiday. Some integrated stainless steel mills switched to production of 200 series whose profits were pushed up by rising prices and stable raw material prices. Moreover, maintenance of steel mills ended. 200 series output in February hiked by 22,000 mt MoM. 300 series stainless steel, the mainstream product of stainless steel mills, saw a 187,000 mt drop from January amid the holiday fallout. Lowering operate rate of domestic state-owned enterprises during the holidays cut 400 series output in February by 120,300 mt MoM.

In March, there will be restart of downstream and terminal sector. According to SMM research, a stainless steel mill in South China received good orders in March. Stainless steel output may increase in March. Indonesian RKAB led to highly volatile nickel raw material prices. Easing of supply tightness due to accelerated quota approval in March and the end of rainy season in Philippines may weaken nickel raw material prices. Therefore, possible cost slip will promote stainless steel production output. Outside China, it is reported that Indonesian stainless steel mills may switch some NPI production lines to high-grade nickel matte production in March, cutting stainless steel output. Domestic stainless steel production may be about 3.2485 million mt in March, up 24.57% MoM. These are estimated productions by product and their MoM changes: 200 series (922,000 mt, +30.04%); 300 series (1.7205 million mt, +23.42%); 400 series (606,000 mt, +20.07%).


SMM statistics revealed 85,200 mt of EMM output in China in February, down 9.26% MoM and 15.11% YoY. The main reason for the monthly output slip was that production scheduling or cost factors put some EMM plants on shutdown throughout February or before the holidays. On the demand side: Overall production of domestic stainless steel, especially 300 series, moved downwards in February. In addition, stainless steel mills purchased goods before or after the holidays. Therefore, EMM stocks piled up in February.

Entering March, operating rates of EMM plants will still be 70%. In spite of delayed plan of production resumption amid bearish market, EMM supply may take an upward turn in March, with figures hiking to 92,300 mt, according to EMM production scheduling survey.

SiMn alloy

China produced 801,200 mt of SiMn alloy in February, down 8.38% MoM and 13.85% YoY, according to SMM statistics. In northern regions, such as Inner Mongolia where high operating rates through the whole February kept monthly output high, while some producers in Ningxia maintained production, with little change in daily output. Falling prices kept pushing down operating rates in southern China. In a word, overall SiMn alloy output in China decreased in February.

Heading into March, SiMn producers will keep production in areas with cost advantages, such as Inner Mongolia, while limited profits amid weak prices may bring low likelihood of operating rates in other areas. However, SiMn output in March may move up to 868,500 mt.

Pr-Nd alloy

China’s Pr-Nd alloy output in February was 5,126 mt, down 8.9% MoM. Affected by migrant workers returning home for the CNY holidays, Pr-Nd production dropped in various regions, especially in Fujian, Jiangxi, and Shandong, and the operating rates dipped over 15% MoM. Some factories in Sichuan chose to outsource. The operating rates stood low in February. Raw material price rout and limited buying may prevent the operating rates of Pr-Nd alloy plants from picking up in March. SMM will still monitor changes in the operating rates.

Pr-Nd oxide

China’s Pr-Nd oxide production in February was down 2.39% MoM at 5,911 mt, with falling production in Jiangsu, Jiangxi, Guangdong, Guangxi and other regions.

According to SMM research, falling operating rates of some plants during the holidays slightly cut Pr-Nd oxide output in February, but the production will return to normal in March.

In early March, listing prices released by China Northern Rare Earth (Group) High-Tech for March took a nosedive. Pr-Nd oxide spot prices also creped down. Even though long-term contract delivery tightened spot Pr-Nd oxide supply, weak buying appetites for high-priced raw materials made it difficult for rare earth prices to hike.

Dysprosium oxide

China’s dysprosium oxide production in February was 217 mt, down 1% MoM. The dip was mainly reflected in Guangxi where lowering operating rate of separate companies during the holidays curtailed 7.5% of local dysprosium oxide output. Government stockpiling of medium-heavy rare earth after the holidays improved dysprosium oxide prices recently. At the same time, facing financial pressure, rare earth ore holders went to cash. Dysprosium oxide output may hike in March.

Terbium oxide

China’s terbium oxide output in February was down 1.3% MoM at 43 mt, with falling output by 7% in Jiangsu.

According to SMM research, terbium oxide production inched down in February amid fallout of scrap losses and the holidays. Separation plants may resume normal production in March. Government stockpiling and purchases by major manufacturers will promote medium-heavy rare earth prices to pick up.

Silicon metal

According to SMM statistics, China's silicon metal output in February 2024 was 345,000 mt, down 1,000 mt or 0.4% MoM but up 64,000 mt or 22.7% YoY.

Judging from the monthly output by province, output was largely stable in most provinces of China. Xinjiang province led with output growth of 5,000 mt due to hiking operating rates of leading plants, while the rest saw output rise by merely 100-1,000 mt.

Heading into March, silicon metal output will increase in most regions, with total output likely exceeding 370,000 mt. Some silicon metal plants in north China may have plans of production expansion and resumption in late February or March, while a few in Dehong Prefecture, Yunnan, may have maintenance or brief maintenance plans in March.


Actual scheduled polysilicon production in February was 163,000 mt (+2.58% MoM) in China. With normal polysilicon production even during the CNY holidays, silicon wafer production scheduling surged in February-March. Boosted by expected rise by over 10% in silicon wafer output and passable profits, polysilicon production scheduling is estimated to be nearly 170,000 mt in March.

PV module

SMM data showed that domestic PV module output was down 20.98% MoM at 30.5GW in February, mainly due to stagnation of many projects in China amid CNY holiday fallout and overseas demand sluggishness, but the output is estimated at 54GW in March, owing to orders delayed from January-February and pick-up of domestic and overseas markets.

Solar cell

Actual solar cell output in China in February was 38.56GW (-25.7% MoM, +8.16% YoY), with P-type cells (14.34GW, -32.45% MoM) and N-type ones (24.23GW, -20.9% MoM). The monthly P-type output slip was mainly attributed to integrated PV module plants. According to SMM research, leading battery and integrated PV module plants operated N-type cell production lines at full capacity during the CNY holidays, while second- and third-tier battery manufacturers and new Topcon battery factories took holidays for 8 to 15 days. With a rise in supply and demand, solar cell production scheduling is estimated at 56.78GW in March, up 47.3% MoM.

PV glass

According to SMM statistics, domestic PV glass production was down 5.14% MoM at 2.227 million mt in February due to maintenance of more production lines, but may hike in March amid falling maintenance.


According to SMM statistics, China’s DMC production in February was 178,500 mt, down 6.89% MoM. The operating rate of the industry in February was down 5.5 percentage points MoM at 74.62%, owing to maintenance of four domestic DMC plants for 10 to 40 days. This reduced DMC output by 13,200 mt MoM in February.

Magnesium ingot

China’s magnesium ingot output was 66,582 mt in February, down 3% MoM and 5% YoY.

Magnesium ingot output was stable-to-soft in February. Some magnesium plants increased their daily output based on order status and funding situation. In contract, there were also plants cutting production as another profit erosions amid falling prices to below the break-even levels put some plants on production cuts or halts. With magnesium prices reaching 18,000 yuan/mt mark, some magnesium plants may reduce operating rates to alleviate severe inventory backlogs. SMM predicts that magnesium ingot production will decrease to 63,000 mt in March.

Magnesium alloy

China's magnesium alloy output was 20,000 mt in February down 22.1% YoY and 23.3% MoM, according to SMM statistics.

Lethargic demand amid fallout of the CNY holidays and ailing domestic economy and chronic magnesium ingot price dip made a bid dent in orders of magnesium alloy plants. Judging from current orders receiving, domestic magnesium alloy plants resumed production in March. Magnesium ingot prices approaching nearly 18,000 yuan/mt may have limited room to drop. Orders may inch up in March. SMM predicts that magnesium alloy production will increase to 23,000 mt in March.

Magnesium powder

China’s magnesium powder output was 5,082 mt in February, down 6.5% MoM and 17.8% YoY, according to SMM statistics.

There were few orders during the holidays and a strong wait-and-see mood among downstream buyers amid falling magnesium ingot prices. In addition, rising shipping costs caused by Houthi’s attack on merchant ships in Red Sea undermined overseas orders, lowering production of some domestic magnesium powder makers. The person in charge of a large magnesium powder company said that poor profits amid domestic economic downturn made magnesium ingot prices more volatile, leading to prudent buying for magnesium powder. Magnesium ingot prices approaching nearly 18,000 yuan/mt may have limited room to drop. Low-priced magnesium ingots may add orders for magnesium powder. SMM predicts that domestic magnesium powder output will hike to 5,500 mt in March.

Titanium sponge

China's titanium sponge output in February was 18,000 mt (-5.3% MoM, +1.2 YoY). Some titanium sponge plants slightly cut output due to maintenance, while the rest were in stable production. Pre-holiday stockpiling of titanium companies who believed prices had hit bottom and shrinking supply tightened spot titanium sponge supply in February. Therefore, titanium sponge producers may keep normal production. Moreover, some may start up new capacity. Titanium sponge output is estimated at 18,500 mt in March.

Molybdenum concentrate

China's February molybdenum concentrate output was 14,800 mt, down 5.2% MoM. Molybdenum concentrate production dipped in February due to fewer working days, maintenance shutdowns in key mines, and additional maintenance during the Spring Festival in southern mines, continuing a slight downward trend. With improving weather and mines resuming operations post-maintenance, an increase in March molybdenum concentrate production is anticipated.


China's ferromolybdenum output in February was approximately 14,800 mt, down 10% MoM. February's ferromolybdenum production fell as small and medium-sized smelters stopped for 1-2 weeks during the Spring Festival and major smelters undergoing maintenance were not at full capacity. Most ferromolybdenum smelters have returned to normal output in March, and with February procurement reaching 12,000 mt, high scheduled production is expected this month. Domestic ferromolybdenum production is expected to increase significantly in March.


February 2024 #1 silver output was 1,276.094 mt, with 976.094 mt from mining, down 30.029 mt (2.3%) MoM and and 1.4% YoY. The production drop in silver is due to lower silver content in ore, fewer operating days during the Spring Festival, and a shorter month compared to January. Silver smelters using external sources experienced mixed output changes: decreased production due to holiday slowdown and limited raw materials in February, while others increased production with the arrival of end-of-year purchases and more activity during the Spring Festival. Expect a modest increase in March silver production due to more production days and continued high silver prices maintaining market interest. The US saw a 140,000 increase in February ADP employment, higher than the previous 111,000 but below the expected 150,000, which is positive for silver prices.

Amid the US election cycle and improved market sentiment from a New York bank incident, expectations of a Q2 Federal Reserve rate hike are growing. This is leading to predictions of volatile but high silver prices in March.

Silver nitrate

February's silver nitrate production decreased due to the Spring Festival and low market demand.

Domestic silver nitrate producers with sales qualifications produced 623 mt of silver nitrate in February, down 32% MoM but up 1.4% YoY. February's production decline is attributed to the Spring Festival causing production stops and early stockpiling in January, along with a P/N type capacity shift in the downstream market reducing demand. After the holiday, silver prices increased slightly amid few new orders and a cautious procurement approach in the market.

Antimony Ingots

China's February 2024 antimony ingot production, including ingots, crude, and cathode, was 4,429.22 mt, down 41.87% from January's 7,619.25 mt. February's antimony production was significantly lower due to raw material shortages and Spring Festival factory shutdowns, with most manufacturers experiencing considerable output declines. A few factories control the raw materials, causing manufacturers ready to resume production to struggle with high costs and procurement challenges.

SMM forecasts that China's antimony ingot production will recover from February's dip as regular operations resume in March. The extent of the rebound will hinge on changes in domestic and imported raw material supply, and downstream demand from industries such as flame retardants and photovoltaics will be crucial to monitor.

Sodium Antimonate

China's February 2024 sodium antimonate production was 3,080 mt, down 33.33% from January's 4,620 mt, ending a two-month production increase. China's sodium antimonate production fell significantly due to reduced manufacturing during the Spring Festival holiday, despite high daily production rates. Sodium antimonate producers expect an upward trend and continued positive demand from the 2024 photovoltaic industry.

Refined Bismuth

According to SMM survey, the output of refined bismuth in China was 1167.599 mt, down 43.16% from January's 2,054.193 mt. The drop in February bismuth production was mainly due to the Spring Festival factory shutdowns and a tight raw material market. SMM expects March's refined bismuth production to rebound without disruptions like the Spring Festival, but surpassing 2,000 mt is still unlikely.

Titanium dioxide

China's titanium dioxide output in February 2024 was 370,000 mt, down 2.1% MoM and up 14% YoY. Despite normal operations during the Spring Festival, scheduled maintenance, particularly in regions like Guangxi, slightly limited the growth of titanium dioxide production.

January's market expectations of low prices led to stockpiling and overseas inventory replenishment, resulting in increased orders and spot shortages of titanium dioxide. Companies worked on reducing excess inventory. Despite some production reductions, high operating rates persisted at plants. March's titanium dioxide production is forecasted to stabilize at 370,000 mt by SMM.

Ammonium paratungstate (APT)

China's APT production in February was about 8,800 mt, down 13.9% MoM. February's APT production dropped significantly due to the Spring Festival and unprofitable smelting margins, prompting many smelters to shut down for maintenance. Although a few resumed post-maintenance, their effect on total production was limited. Smelters fulfilling long-term orders are resuming work in March despite losses, which may result in a slight increase in APT production.

Lithium carbonate

February's domestic lithium carbonate production was approximately 32,475 mt, down 21.8% MoM but up 5.4% YoY. The combined total for January and February was 73,998 mt, up 10.9% YoY. Lithium salt companies buying external lithium ore faced low profits and difficulty securing long-term orders post-New Year, leading many small and medium-sized firms to reduce or halt production from January, a trend that continued until a gradual resumption in late February. Major lithium salt firms conducted annual maintenance over February's Spring Festival, significantly impacting lithium carbonate production from lepidolite, spodumene, and recycled materials. Shandong's lithium salt enterprises took more outsourcing orders and turned to imported spodumene to tackle raw material challenges. Salt lake producers saw a further output decline in February due to fewer production days and lower efficiency in winter.

In March, while some small and medium-sized lithium salt businesses in Jiangxi face maintenance and environmental delays, these issues are not significantly affecting large local producers. Firms outside Jiangxi are normalizing production, with market recovery poised to affect production rates. A rebound in lithium carbonate production from raw ore and recycled materials is expected, and salt lake production efficiency should gradually improve with rising temperatures.

March's estimated domestic lithium carbonate production is around 42,403 mt, up 30.6% MoM and 41.6% YoY.

Lithium hydroxide

China's lithium hydroxide production in February was 17,692 mt, down 21% MoM and 27% YoY.

February's lithium hydroxide production included 15,622 mt from smelting, down 20% MoM, and 2,070 mt from causticization, which fell 30% MoM. The downturn is largely because the price inversion between lithium hydroxide and carbonate has made causticization economically unattractive, reducing production interest among firms. China's cumulative lithium hydroxide output for January-February 2024 was 40,142 mt, down 12% YoY. February's market saw a significant decline in lithium hydroxide scheduled production due to fewer production days and reduced output from smelters undergoing maintenance during the Spring Festival, resulting in the postponement of February orders. Some companies slowed or stopped production early in February, with operations gradually resuming towards the end of the month. Despite ongoing consumption causing low inventories and a tight lithium hydroxide market leading to rising prices and a push to increase production, industry supply for the month continued to decline.

China's lithium hydroxide production in March is expected to reach 27,150 mt, up 54% MoM and 14% YoY, driven by recovering downstream orders and the ramp-up of new production lines.

Cobalt sulphate

China's cobalt sulphate output in February was 4,058 mt in metal content, down 27% MoM and 45% YoY. The sharp fall in output was due to maintenance by cobalt salt companies during the Spring Festival holiday and February's fewer days.

For March, with the Spring Festival holiday concluding, some smelters are expected to gradually restart production, although high raw material prices may delay this resumption, raising costs for recycling enterprises. The expected March production increase is estimated at about 4,831 mt in metal content, up 19% MoM but down 45% lower YoY, potentially falling short of initial forecasts.


China's February production of Co3O4 was 6,476 mt, down 13% MoM but up 70% YoY. February's Co3O4 production dip was mainly due to the month's short length and routine Spring Festival maintenance by some small and medium-sized factories, despite ongoing production at major factories to meet high demand. March is expected to see a rise in Co3O4 production with demand recovery and order fulfillment, forecasted at 7,191 mt, up 11% MoM and 28% YoY.

Ternary cathode precursor

China's ternary cathode precursor production in February 2024 was about 61,590 mt, down 20% MoM and 7% YoY. February's off-peak season saw precursor companies adjust production to match sales, resulting in decreased output. Maintenance shutdowns at some plants further reduced overall production. Vertically integrated firms fulfilling cathode orders and those serving overseas markets continued operations during the holiday period. Domestic cathode producers moved their precursor inventory consumption from February to January, reducing February demand, but demand for 6-series materials from leading battery cell makers stayed robust. Despite increased overseas cathode production, stable international demand persisted for some Chinese precursor firms in February due to limited foreign precursor capacity.

For March 2024, the domestic EV market's preference for mid-to-high-nickel materials is increasing demand for ternary cathode precursors. Additionally, rising nickel prices are leading consumer market players to build up their precursor inventories. As the ternary market heats up, supply varies by company. Those with integrated nickel resources may increase scheduled production to meet orders, while others consider raw material costs higher than selling prices, leading to selective order acceptance and potentially reduced production. The March 2024 forecast for China's ternary cathode precursor production is 71,606 mt, up 16% MoM and 32% YoY. From January to March, China's cumulative ternary precursor production may be about 209,961 mt, up 18% YoY.

Ternary cathode material

February 2024 production was 47,102 mt, down 15% MoM but up 2% YoY. Key players in the digital and power battery markets kept up production to fulfill existing orders, while many smaller factories reduced or ceased production. In the EV market, the February off-season led to low operating rates among cathode manufacturers. Material side, there was a significant drop in the share of Series 5, a slight decrease in Series 8, and an increase in Series 6, which reached a 33% share. Battery cell manufacturers synchronized their February holidays with public holidays and order statuses, leading to some stockpiling in January and consequently reduced cathode procurement in February.

For March 2024, supply forecasts indicate a significant MoM scheduled production increase, with a split market. Producers of mid to high-nickel products are increasing operating rates, while those targeting overseas markets are not experiencing notable production gains.

Overseas markets are experiencing gradual growth in consumer and power battery segments, with some battery cell makers seeking to secure orders at lower prices. The EV battery market favors top manufacturers with rising ternary material demand, while second and third-tier makers encounter stable but softening demand amid slow vehicle sales projections for March. March's forecast for China's ternary cathode material production is 62,011 mt, up 32% MoM and 35% YoY. The cumulative production for January-March 2024 is expected to be 164,466 mt, up 24% YoY.

Iron phosphate

China's iron phosphate production in February was 59,600 mt, down 21% MoM and 14% YoY, due to reduced operating rates during the Spring Festival and a market focus on reducing inventories. February's increase in raw material prices led to significant cost inversion, causing iron phosphate firms to raise prices post-holiday to maintain stability. This, combined with a rebound in downstream demand in March, has increased the operating rates of iron phosphate enterprises. March 2024 projections for China's iron phosphate production forecast 110,100 mt, up 85% MoM and a 59% YoY.


February's production of China's LFP was 80,550 mt, down 19% MoM but up 13% YoY, with output in the first two months up 32% YoY. Material costs remained stable due to low lithium carbonate and iron phosphate prices. February's LFP cathode supply dipped due to the Spring Festival and off-peak season, with firms taking breaks or reducing production. Market activity paused pre-holiday and resumed cautiously post-holiday, focusing on inventory management and de-stocking for the month. Pre-holiday, the EV and energy storage markets were quiet. Post-holiday, activity rebounded, driven by price competition in the new energy vehicle sector and energy storage market developments. However, the restart delay of some battery cell firms slowed the recovery, causing a slight lag in LFP deliveries. Anticipating improved market demand, an upswing in LFP orders is expected for March. China's LFP production for March 2024 is forecasted at 126,860 mt, up 58% MoM and 80% YoY.


February's China LCO production stood at 4,400 mt, down 41% MoM but up 1% YoY. Rising lithium carbonate prices increased LCO production costs, challenging the spot market's absorption capacity, while the long-term market adapted to metal price trends. The off-peak season and the Spring Festival resulted in widespread manufacturer shutdowns, with minimal ongoing production. Major players restarted after the holiday, but some smaller factories remained closed in February due to weak orders. The high-rate battery market saw below-average performance, while demand for high-voltage batteries remained stable.

March's estimated LCO production is 6,070 mt, up 38% MoM and up 16% YoY. After the holiday, LCO manufacturers are preparing for a moderate production rebound in March.

Battery cell factories are cautious about market demand for Q2 due to no significant new model launches in the first half of the year. Despite rising lithium prices, LCO production is sales-dependent, with purchases made as needed.


China's February 2024 LMO production decreased by 23% MoM to 5,670 mt, despite up 47% YoY. Following the holiday, new orders declined as battery cell manufacturers had previously built up inventories. LMO producers concentrated on fulfilling January orders, resulting in fewer new orders and a scheduled reduction in production. March saw a small increase in lithium carbonate spot prices, raising LMO firms' procurement costs and leading to higher quotes. Downstream stockpiling increased, boosting LMO companies' production schedules. LMO output for March is projected to be around 8,000 mt, up 41% MoM and 95% YoY.


For queries, please contact Michael Jiang at michaeljiang@smm.cn

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