Frequent Production Cuts by Silicon Metal Enterprises, Operating Rates in Major Production Areas Decline [SMM Silicon Metal Weekly Survey]

According to the SMM survey, the weekly production of sample silicon enterprises in Xinjiang (accounting for 79% of capacity) was 30,540 mt, with a weekly operating rate of 63%, significantly down WoW. In-plant inventory slightly decreased WoW. Last week, some capacity reductions occurred at the Shanshan plant of a major enterprise in Xinjiang, leading to a significant drop in weekly production, while the operating rates of other silicon enterprises remained stable. In terms of market transactions, small and medium-sized silicon enterprises in Yili and other areas are delivering previous orders, and some enterprises indicated that if the futures market continues to be sluggish, there might be further production cuts. Some enterprises negotiated real orders for shipment within the week, and some aluminum-silicon alloy plants engaged in restocking.

The weekly production of sample silicon enterprises in Yunnan (accounting for 30% of capacity) was 8,510 mt, with a weekly operating rate of 48%, flat WoW, and in-plant inventory fluctuated slightly. Due to sampling bias, the weekly operating rate in Yunnan appeared higher; however, the operating rate for the entire province was around 30% in November. With further production cuts by both sample and non-sample enterprises in December, the provincial operating rate is expected to decline again.

The weekly production of sample silicon enterprises in Sichuan (accounting for 32% of capacity) was 1,390 mt, with a weekly operating rate of 21%, down WoW. Some sample enterprises halted production within the week. For the entire province, some capacities in Sichuan reduced or halted production at the end of November, and some capacities in Aba Prefecture are expected to cut production in mid to late December, with the provincial operating rate expected to fall below 10% by month-end. In terms of market transactions, the impact of low-priced northern supplies combined with futures and spot cargoes has led to fewer real order signings by silicon enterprises recently.