Silicon Metal Raw Material Demand Is Expected to Weaken and Prices Remain Stable with A Tendency to Weaken [SMM Analysis]

Currently, silicon prices are still operating below the cost line for most silicon companies. The production enthusiasm of silicon metal manufacturers remains mediocre, and many silicon companies in Sichuan and Yunnan plan to shut down furnaces next month. The demand for restocking silicon metal raw materials also weakens. Although some small silicon companies in north China prepare to purchase raw materials for resumption after National Day, the overall increase in raw material demand is not significant. In terms of raw materials, the demand for silicon coal and charcoal has been generally moderate recently, and future demand is expected to continue weakening.

For silicon coal, recent slight recovery in coking coal prices in certain areas has led to an increase in pithead coal prices in some regions. However, since the last increase in silicon coal prices following pithead coal prices did not lead to smooth sales, silicon coal prices remain stable amid this round of slight increases in some pithead coal prices.

For charcoal, as some silicon companies in Yunnan expect to shut down furnaces earlier during this year's rainy season, some manufacturers may gradually shut down furnaces in October. As a result, charcoal import traders have reduced import frequency, and some have directly suspended import trade, leading to a dual weakening in charcoal demand and supply.

Overall, prices of silicon metal raw materials are mostly stable with a tendency to weaken. Under the impact of expected weakening downstream demand, there is little room for price increases. However, some raw material prices may fluctuate with cost changes.