Silicon Wafer Supply Rose 18.5% MoM in Jan amid End Consumption Recovery

SHANGHAI, Feb 6 (SMM) - According to SMM statistics, domestic silicon wafer production in January was about 32.1 GW, a sharp increase of 18.5% from last December. In early January, silicon wafer companies were active in ramping up the production when the end consumption was expected to recover while their finish product inventory stood at low levels. Therefore, the silicon wafer output rose steeply in January.  

According to SMM survey, the silicon wafer output in December slipped beyond expectations as producers at various links cut their production amid an unexpected sluggish market. As a result, the silicon wafer stocks that were accumulated earlier fell sharply.

SMM statistics showed that as of January 10, the social inventory of silicon wafers already dropped to about 350 million pieces, down by 68.2% from mid-December. The dangerously low level of silicon wafer inventory prompted companies to increase the production schedules in January.

On the other hand, some terminal projects were available for bidding in the middle and late January, and more projects were said to come up for bidding after the Chinese New Year holiday. The market confidence was thus boosted, and module companies also actively increased their production. The demand recovery eventually stimulated silicon wafer companies to expand the production. Under these circumstances, the silicon wafer output soared.  

In addition, the rebound in polysilicon prices also helped restore the confidence of silicon wafer producers. When downstream restocking demand emerged, the silicon wafer also enhanced the production in response.

As for the market in February, SMM survey indicates that terminal demand will further pick up, and silicon wafer companies are still keen on building up the finish product inventory, which is reflected in the high operating rates. SMM thus estimates that the average operating rate of silicon wafer enterprises will stand at about 70% in February, and the total supply will reach about 34.2 GW.