This week, both spot and futures prices of silicon metal showed a downward trend. These are silicon metal prices (by type) as of July 25 and their WoW changes: standard #553 silicon metal in East China (11,600-11,700 yuan/mt, -250 yuan/mt WoW), above-standard #553 silicon metal (11,700-12,000 yuan/mt, -300 yuan/mt WoW), #441 silicon metal (11,900-12,300 yuan/mt, -500 yuan/mt WoW), and #421 silicon metal (12,200-12,800 yuan/mt, -450 yuan/mt WoW). The most-traded Si2409 contract continued to decline, hitting a low of 10,070 yuan/mt, setting a new low for futures prices. Traders and downstream users significantly increased their purchases in the spot market based on futures prices, with the main transaction areas in South China, while East and North China saw relatively fewer transactions. On Wednesday, leading producer Hoshine Silicon Industry lowered its prices again by 600 yuan/mt after last week's adjustment, with above-standard #553 silicon delivered to Jiangsu and Zhejiang at 11,700 yuan/mt and #421 silicon at 12,200 yuan/mt. This price adjustment gave Hoshine a certain advantage over most other suppliers. After the leading producer reduced prices to boost sales, some companies adopted a wait-and-see stance, while others followed suit and lowered their prices. The focus of silicon metal spot transactions shifted downward.
After the price concessions by leading silicon companies, the prices have dropped below the cost lines of most other silicon companies, putting pressure on their production and shipments. With the support from transactions in the spot market based on futures prices and the price concessions by leading silicon companies, silicon metal price declines are expected to gradually narrow next week.
