Low arrivals, mainly cargo pick-ups; silicon metal social inventory continues destocking trend [SMM Silicon Inventory]

[SMM Express] Recent developments across Northam Platinum, Sibanye-Stillwater and Southern Palladium indicate that South Africa's platinum group metals (PGM) producers are increasingly positioning chrome as a strategic co-product rather than merely a by-product, reflecting a broader shift across the Bushveld Complex. Northam recently reported record chrome concentrate production of 1.69 million mt in FY2026, up 17.4% year-on-year, while Sibanye-Stillwater plans to expand chrome production to 2.3 million mt/y by 2033 and Southern Palladium's Bengwenyama Project has nearly tripled projected chrome output through improved chromite recovery, underscoring chrome's growing contribution to project economics and revenue diversification. The trend is further reinforced by Merafe Resources' H1 2026 Trading Statement, in which the company expects significantly stronger interim earnings despite a 75% year-on-year decline in ferrochrome production, supported by higher commodity prices and increased sales volumes. SMM believes these developments point to a broader structural shift within South Africa's PGM sector, with producers increasingly leveraging chrome to strengthen earnings resilience, diversify revenue streams and enhance the long-term value of UG2 operations across the country's chromium value chain.

[Production Under Pressure, Supply Marginal Reduction, Silicon Prices Remain Under Pressure] Currently, the silicon metal industry chain is showing a clear game-playing pattern, with structural divergence between upstream and midstream. On the supply side, silicon enterprises are incurring cash flow losses, and a few have undergone maintenance and production halts. As the actual output reduction has been limited so far, it has not had a directional impact on market sentiment. Silicon enterprises are holding prices firm and unwilling to lower quotations to boost orders, leading to an accumulation trend in industry in-factory inventory. In the midstream, social inventory has been destocking for several consecutive weeks. Trading firms engaging in both spot and futures markets are preferring transactions at low futures levels, and inventories in the trade circulation sector continue to destock. The tightening of circulating supply has driven the spot-futures price spread to strengthen, with spot prices showing greater resistance to declines than futures.

【SMM Tantalum & Niobium Express】Global Advanced Metals (GAM), a leading high-purity tantalum and niobium producer in North America, officially put its upgraded new metallurgical purification process into operation at its Boyertown, Pennsylvania production base in June this year. This integrated optimized purification process revolutionizes the traditional electron beam melting and solvent extraction workflows, enabling precise control of trace oxygen, carbon and metallic impurities in tantalum and niobium feedstocks. Verified through multiple batches of industrial trials, the yield rate of superconducting-grade niobium for fusion magnet components has increased by 18 percentage points compared with the original process. Superconducting-grade niobium requires extremely low impurity content to ensure an ultra-high residual resistance ratio, making it an indispensable core raw material for the ITER Nb₃Sn superconducting coils. GAM has signed a multi-year fixed supply framework agreement with General Atomics, the US domestic manufacturing general contractor for ITER. The new process simultaneously improves the purification efficiency of semiconductor-grade high-purity tantalum ingots, cutting the single-batch production cycle by 22% and significantly reducing material loss. Currently, the global supply of niobium dedicated for fusion applications is tight, and this technological upgrade enables GAM to expand its stable supply capacity for ITER and other large-scale particle accelerator projects. The company stated that it will further expand its purification production lines by 2027 to meet the surging market demand for superconducting metals driven by the global fusion energy and high-end semiconductor industries.