Silver nitrate production fell as expected in June, with processing fees more likely to fall than rise [SMM analysis]

In June 2025, silver nitrate production declined as expected, primarily due to reduced demand from downstream silver paste and solar cell enterprises. Overall, silver nitrate production fell by 5.8% MoM. A silver nitrate enterprise stated that while orders from major clients remained stable, orders from smaller clients decreased significantly, leading to a decline in the overall operating rate.

In the first half of 2025 (H1), the strengthening silver price drove up the capacity valuation of silver nitrate. However, as new capacity entered the market, the processing fee for silver nitrate faced downward pressure. Some enterprises reported that orders were being closed below cost to gain market share. Consequently, the operating rates of silver nitrate enterprises varied, with some even increasing compared to May.

Looking ahead to July, end-use demand in the PV industry has not yet recovered significantly. Due to the pullback in solar cell prices, some silver powder and silver paste enterprises also face expectations of profit compression. Although the current processing fee for silver nitrate has shown a downward trend, the processing fee for silver powder and silver paste has not yet adjusted significantly. Solar cell manufacturers may reduce silver consumption per unit by adjusting formulations to achieve cost reduction and efficiency improvement. Therefore, silver nitrate enterprises generally hold a cautious and pessimistic attitude, expecting silver nitrate production in July to remain stable or continue to decline slightly.

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