Silicon Metal Back in Stalemate After Breakdown Rebound, Market Trading Cools [SMM Silicon Industry Weekly Review]

SMM, July 16: Silicon Metal: This week, the most-traded silicon metal futures contract price returned to narrow fluctuations near 8,450 yuan/mt, with a narrowed price fluctuation range. Total open interest in the market continued to decline during the week, with the most-traded September contract's open interest falling by 53,000 lots from last Friday, and the all-contract weighted open interest dropping by 54,000 lots from last Friday. Trading sentiment cooled, while wait-and-see sentiment among funds increased. Spot prices, as of July 16, for SMM east China oxygen-blown #553 silicon were 9,100-9,200 yuan/mt, up 150 yuan/mt WoW; #441 silicon was 9,200-9,300 yuan/mt, up 50 yuan/mt WoW; and #421 silicon was 9,300-9,400 yuan/mt, flat WoW. During the week, offers from silicon enterprises mostly remained stable. After active procurement and trading last week, traders and some downstream buyers saw dealing heat decline this week, leading to a stalemate in silicon metal buying and selling, with prices shifting to consolidation.

Demand side, polysilicon weekly operating rate was basically flat WoW, and polysilicon maintained its growth trend in July. Silicone weekly operating rate moved sideways, currently estimated at around 59%-60%, down from June but with limited decline. Aluminum-silicon alloy operating rate consolidated on a weak note, constrained by the summer high-temperature off-season, with downstream end-user orders lacking growth, leaving demand-side support insufficient.

Raw material side, silicon coal prices held steady recently, providing solid bottom cost support for silicon metal prices; however, demand fundamentals remained weak overall, spot prices lacked effective upward drivers, and price follow-through momentum was insufficient, pushing the market back into a pattern of stalemate and narrowing price fluctuations. Supply side, industry supply pressure is slowly mounting, the supply-demand pattern is weak, and silicon metal market sentiment remains under pressure overall.

Polysilicon: This week, the polysilicon price index was 31.58 yuan/kg, with N-type recharging polysilicon quotes at 30.5-33 yuan/kg and granular polysilicon quotes at 31-32 yuan/kg. Overall prices remained in the doldrums. Early in the week, overall trading was weak and some prices continued to decline; later, news of relevant industry meetings and cost support helped stabilize market prices temporarily. Currently, the trading atmosphere remains weak, with attention focused on the relevant meeting next Monday.

Wafer: This week, wafer prices stopped falling and stabilized, with N-type 183 wafer prices at 0.85-0.87 yuan/piece, 210R wafer quotes at 0.96-0.97 yuan/piece, and 210mm wafer quotes at 1.16-1.18 yuan/piece. This week, mainstream wafer prices remained unchanged. Some enterprises engaged in contract slicing, due to lower non-silicon costs such as wire diameter, had slightly lower selling prices than the market, yet the overall impact on the market was relatively small. Recently, market sentiment was poor, with main concerns about whether July battery production would see significant production cuts due to losses, but the current situation is relatively clear. After wafer production schedule expectations were raised, the market is basically in a tight supply-demand balance. Looking forward, wafer prices are not expected to fall significantly, but a slight price concession cannot be ruled out, maintaining the situation of selling above cash costs.

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