The Silicon in June 2020

Analysis of silicon metal market in June

1. Metallurgical grade silicon metal market

In June, the mainstream transaction price of silicon metal has continued to decline. Most grades have fallen to the lowest price in recent three years.  There are many enterprises with inverted cost. More and more factories stop the production. In the wet season, Sichuan and Yunnan silicon plants have resumed production gradually, and the overall monthly output is still showing an obvious upward trend. In June, the metal silicon market was not active, and most traders had no orders or only few orders. The regular orders also decreased by more than 50%. The purchasing enthusiasm was low. Most of the 553 factories have been in a red and only maintain the consumption of raw materials.

2. Chemical grade silicon metal market

The price of chemical grade silicon 421 fell significantly this month. The price purchased by the silicone factory fell by about 400 RMB this month, but the cost of silicon factory was high. The si plants have no willingness to sell it at low price. According to the current production of silicone and the commissioning of new plants, the consumption of chemical silicon is relatively stable.

3. Silicon metal export market

In May, China’s total export of metal silicon was 31,075 tons, with a monthly decrease of 36.21%, a yearly decrease of 53.56%.The total export volume is 256,212 tons from January to May in 2020, with a yearly decrease of 14.85%. Due to the outbreak of domestic epidemic in February, the international market is still safe. But foreign investors are worried that it is difficult to maintain normal production and advance part of the order delivery date. Therefore, the export volume of silicon metal market increased rapidly to more than 80,000 tons in March. However, it began to decline in April and May. In May, the export volume was cut by half. Recently, there are no long-term orders from several foreign large factories. The exporting traders only increase small orders.

4. Silicon metal production

In June, 260 sets of silicon metal furnaces were put into operation, which increased by 59 sets than last month. The operating rate was 42.90%, with a monthly increase of 9.79%. The production capacity was 228,950 tons. The monthly actual output was 183,920 tons, with an increase of 1810 tons on a year-on-year basis, an increase of 35,300 tons on a month on month basis. The total output is 92,600 tons from January to June, with a yearly decrease of 5.63%.

Sichuan and Yunnan silicon plant resumed production after entering the wet season in June.  Some factories will increase production in a small amount from July to August. But silicon plants in other regions such as Fujian, Hunan, Chongqing, Inner Mongolia, Guangxi and other places will successively reduce production and wait for the market. It is estimated that the national silicon metal production will be maintained at about 260 units by July, and the monthly output will be about 190,000 tons.