Frequent Price Adjustments: The Silicon Coal Market Remains Unstable at Year-End [SMM Analysis]

In mid-December, leading silicon coal plants in Ningxia once again adjusted the raw coal prices. This time, the adjustment was relatively small, with a slight decrease of 20 yuan/mt. However, since Q4, leading silicon coal plants in Ningxia have frequently lowered silicon coal prices, leaving the year-end silicon coal market far from stable.

This year, the continuous weakness in downstream silicon metal markets, combined with the sustained growth in silicon coal supply, has caused silicon coal prices to fluctuate downward throughout the year. Additionally, with the implementation of new regulations on silicon metal delivery brands, the sales dynamics of silicon coal in various production regions have changed. Silicon coal from Xinjiang, known for its superior overall quality, has once again become the preferred source for silicon enterprises in north China. Consequently, Ningxia's market share in the northern market has been affected. Meanwhile, in south-west China, older silicon metal production regions faced challenges due to low silicon metal prices. Silicon enterprises in the region delayed production during the rainy season and ended production earlier than usual before the dry season, leading to weaker local silicon coal demand. Overall, the demand for silicon coal in Ningxia this year has been relatively weak, prompting continuous price reductions in Q4 to stimulate demand.

At year-end, the best-performing product in the market is Xinjiang's non-caking silicon coal. With its dual advantages of high quality and low price, major northern enterprises have recently shifted back to using Xinjiang's non-caking silicon coal, with some signing long-term procurement contracts for the coming year. Additionally, some south-west China plants have started experimenting with Xinjiang's non-caking silicon coal this year, driving strong market demand.

In summary, recent fluctuations in the silicon coal market have been primarily concentrated in Ningxia. As the year-end approaches, under the influence of weak demand, silicon coal prices continue to fluctuate downward, and the local market in Ningxia remains sluggish.