Silicon metal raw material market continues to be under pressure, with sluggish trading sentiment [SMM Weekly Review of Silicon Metal Raw Materials]

Silica: This week, the silica market remained in the doldrums. Overall, market transactions were sluggish, with low trading activity. In terms of supply, the loose market pattern persisted. In terms of demand, the market continued to be weak. Few operations resumed in the south-west China during the rainy season, and operating rates in other regions remained low, resulting in limited overall demand for silica. Additionally, the recent decline in silicon metal prices has led to strong sentiment to drive down prices in raw material procurement, further compressing the bargaining space for silica producers. Currently, the mine-mouth price of high-grade silica in Inner Mongolia ranges from 310 to 350 yuan/mt. In Yunnan, the mine-mouth price of low-grade silica ranges from 300 to 320 yuan/mt. In Guizhou, the mine-mouth price of low-grade silica ranges from 170 to 210 yuan/mt. In Hubei, the mine-mouth price of high-grade silica ranges from 340 to 370 yuan/mt.

Silicon coal: This week, prices in some regions of the silicon coal market declined again. Cost side, although the coking coal futures market has performed well recently, the spot market has been unable to follow the upward trend due to weak demand, with some regions even experiencing a decline in coking coal prices. This has also impacted silicon coal prices, leading to a decrease in some regions. In terms of supply, production by manufacturers proceeded normally, with production schedules arranged according to orders to reduce the risk of inventory buildup. In terms of demand, influenced by the low operating rates of silicon plants and the low resumption rate in the south-west China during the rainy season, demand remained weak, with only necessary restocking activities. Currently, the average price of silicon mixed coal in Gansu is 840 yuan/mt, and the average price of granular coal is 960 yuan/mt. In Ningxia, the average price of silicon mixed coal is 900 yuan/mt, and the average price of granular coal is 1,140 yuan/mt. In Xinjiang, the average price of non-caking silicon coal is 710 yuan/mt, and the average price of caking silicon coal is 1,250 yuan/mt.

Petroleum coke: This week, the petroleum coke market continued to be in the doldrums. Refinery shipments were sluggish, and prices lacked upward momentum. SMM data showed that the average price of petroleum coke at local refineries was reported at 2,230 yuan/mt, down 1.13% MoM. Transactions of Formosa Plastics petroleum coke were mediocre during the week, with poor downstream purchases. Coupled with a significant decline in the latest tender price, the price of Formosa Plastics petroleum coke weakened. Currently, market prices range from 1,000 to 1,050 yuan/mt. Overall, downstream enterprises are still focusing on necessary restocking, with no significant growth in overall demand. It is expected that petroleum coke prices will remain generally stable with slight fall in the short term.

Electrodes: This week, the electrode market remained at a low level. The overall electrode market is characterized by high inventory and weak demand. Firstly, affected by the sluggish silicon metal market and the contraction in demand from steel mills, shipments from producers have slowed down, leading to high inventory levels. Currently, most producers have halted production, focusing mainly on destocking to alleviate the supply-demand imbalance in the market. Secondly, due to the downward trend in the raw material market, cost support has been weak. Additionally, the long production cycle of electrodes has led to losses for producers, placing significant pressure on them. Currently, the quoted prices for ordinary power carbon electrodes with diameters of 960-1100mm are 6,200-6,400 yuan/mt, while those with diameters of 1272mm are 6,900-7,100 yuan/mt. For ordinary power graphite electrodes, the quoted prices for diameters of 960-1100mm are 9,300-9,500 yuan/mt, and for diameters of 1272mm, they are 10,900-11,100 yuan/mt.

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