Future Supply Expected to Weaken, High-Purity Quartz Sand Prices Raised [SMM Analysis]

SMM January 7 News: Recently, domestic leading enterprises in high-purity quartz sand have raised the quotations for medium and inner layer sand used in crucibles. SMM has learned that the increase reached nearly 5,000 yuan/mt. The main reasons include the gradual reduction in the supply of domestic sand and restrictions on quartz raw ore mining in India and other regions. The long-term supply is expected to weaken, and under the backdrop of a recovery in demand from sectors such as silicon wafers, the quotations for high-purity quartz sand have been adjusted. However, the current prices have not yet resulted in transactions, as downstream crucible enterprises are mainly engaged in price negotiations, leading to a temporary stalemate. Recently, domestic leading enterprises in high-purity quartz sand have raised the quotations for medium and inner layer sand used in crucibles. SMM has learned that the increase reached nearly 5,000 yuan/mt. The main reasons include the gradual reduction in the supply of domestic sand and restrictions on quartz raw ore mining in India and other regions. The long-term supply is expected to weaken, and under the backdrop of a recovery in demand from sectors such as silicon wafers, the quotations for high-purity quartz sand have been adjusted. However, the current prices have not yet resulted in transactions, as downstream crucible enterprises are mainly engaged in price negotiations, leading to a temporary stalemate.

High-Purity Quartz Sand Price Trend:

According to SMM, after this price adjustment, the quotations are 70,000 yuan/mt for inner layer sand and 45,000 yuan/mt for medium layer sand, with an increase of nearly 5,000 yuan/mt. This price increase by leading enterprises is reportedly related to the recent reduction in supply. Over the past few months, the supply from domestic high-purity sand enterprises has continued to decline, with the operating rate of some enterprises dropping to less than 30%, and even leading enterprises operating at less than half capacity. Additionally, there are supply restrictions on overseas ore sources, the specific reasons for which SMM is still investigating. Long-term supply is expected to continue declining. Meanwhile, the recent increase in silicon wafer production schedules in China has boosted demand for quartz sand. Under the combined effect of weak supply and strong demand, sand enterprises have slightly raised their quotations.

Silicon Wafer Production Schedule Trend:

After the price adjustment, due to concerns about the long-term supply of quartz sand, domestic spot order traders of imported sand have recently performed well in taking orders. Some crucible and integrated enterprises have increased their procurement volume of imported sand. As for domestic sand, there have been no transactions, mainly because downstream enterprises still have concerns about the quality of domestic sand, leading to limited demand. Additionally, the quality of substitutes is continuously improving, and crucible enterprises have limited willingness to accept price adjustments for quartz sand. Furthermore, the purchasing intention before the Chinese New Year remains low, with most enterprises focusing on price negotiations and bargaining.

Regarding future price forecasts, SMM believes that the mainstream transaction center for quartz sand prices will remain stable in the near term. Although quotations have risen, this has not yet become a widespread trend. Crucible enterprises are primarily focused on price suppression and negotiations. Whether transaction prices will increase depends on the subsequent performance of both the supply and demand sides. For now, the market appears to be maintaining a relatively stable situation.