[SMM Analysis] Production Peaks with Limited Demand Growth, Oriented Silicon Steel Prices in the Doldrums

Published: Sep 5, 2025 15:28

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[Production Jumps Initially While Demand Growth Remains Limited, Silicon Steel Prices Expected to Stay in the Doldrums] This week, prices of most grades of cold-rolled silicon steel dropped, with sluggish market transactions. Market feedback indicates that on the cost side, HRC futures initially dipped before rebounding, but market confidence remained weak. HRC inventory began accumulating, and spot prices declined slightly, weakening cost support for silicon steel and negatively impacting its market. Supply side, newly commissioned production lines operated normally at producers, increasing silicon steel supply. However, some producers' September order intake fell short of expectations, with direct supply volumes declining, leading to looser supply. Demand side, previous sharp price hikes for silicon steel prompted substantial downstream end-user orders. Currently, the focus is on consuming existing inventory, with low purchase willingness. Coupled with the market's initial surge followed by a pullback and prevalent wait-and-see sentiment, procurement intent further weakened. Looking ahead, with demand release lagging expectations, production continuing to climb, and cost support diminishing, silicon steel prices are expected to remain in the doldrums next week, retaining further downside potential.

Price Movement of Grain-Oriented Silicon Steel

Shanghai B23R085: 13,800-14,000 yuan/mt

Wuhan 23RK085: 13,700-13,900 yuan/mt

This week, prices of most grades of cold-rolled grain-oriented silicon steel dropped, with sluggish market transactions. Market feedback indicates that cost-wise, HRC futures initially dipped before rebounding, but market confidence remained weak. HRC inventory began accumulating, and spot prices dropped slightly, weakening cost support for grain-oriented silicon steel and bearish for its market. Supply side, newly commissioned production lines at producers operated normally, increasing grain-oriented silicon steel supply. However, some producers' order intake in September fell short of expectations, with direct supply declining, leading to looser supply. Demand side, the previous sharp price surge in grain-oriented silicon steel prompted substantial downstream end-user orders, leaving current demand focused on inventory drawdown with low purchase willingness. Coupled with the market's initial jump and subsequent pullback, wait-and-see sentiment intensified, further dampening procurement intent. Looking ahead, with demand release lagging expectations, production continuing to climb, and cost support weakening, grain-oriented silicon steel prices are expected to remain in the doldrums next week, retaining room for further declines.

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