The yearly report for silicon metal in 2024

I. 2024 Silicon Metal Price Trend Review
1. First Quarter:
• Silicon prices kept falling. Before the Chinese New Year, some regions reduced production, but the market was cautious, with limited transactions and only essential orders.
• After the Chinese New Year, a major factory in the north sold at low prices, causing prices to drop further.

2. Second Quarter:
• At the start of the quarter, price declines slowed. Some factories stopped production, and traders began stockpiling.
• In May, silicon factories in Sichuan resumed operations, increasing production nationwide. Futures hedging led factories to sell actively, with high-priced deals mainly handled by traders.
• In June, factories in Sichuan and Yunnan resumed production, pushing spot prices to a low. However, market demand remained weak, and prices were heavily pressed down.

3. Third Quarter:
• In July, both silicon futures and spot prices dropped. Small factories stopped production due to losses, and supply-demand imbalance pushed prices further down.
• In August, spot prices hit bottom. Some customers placed orders, increasing factory order volumes. By the end of the month, a major northern factory raised prices, and the market showed signs of recovery.
• In September, prices slightly increased and then stabilized. Most factories were reluctant to sell, and the market mainly saw essential purchases with little stockpiling.

4. Fourth Quarter:
• In October, southern silicon factories prepared to shut down and refused to sell at low prices. Northern factories hedged through futures, limiting spot supply and slightly raising prices.
• In November, spot prices were pressured by weak demand and customer price cuts, keeping the market sluggish.
• In December, prices continued to fall as factories accumulated inventory. Pre-Chinese New Year stockpiling failed to boost the market.
II. 2024 Silicon Metal Operating Rate

• Average Annual Operating Rate: 53.47%, a decrease of 0.28% year-on-year.
• Highest Rate: June, with an operating rate of 66.43% and 463 furnaces in operation.
• Lowest Rate: December, with an operating rate of 38.60% and 276 furnaces in operation.

III. Silicon metal production and downstream consumption
Annual Production: 4.8918 million tons, an increase of 0.9778 million tons (+24.98%) year-on-year.
• Average Monthly Production: 0.4077 million tons.
• Highest Monthly Production: July, 0.4967 million tons.
• Lowest Monthly Production: April, 0.3336 million tons.
Production by Region:
1. Xinjiang: 2.53425 million tons
2. Yunnan: 0.64363 million tons
3. Sichuan: 0.42478 million tons
4. Inner Mongolia: 0.40465 million tons
5. Gansu: 0.34276 million tons

(See the chart below for details.)
Silicon metal consumption in downstream markets
1. Polysilicon:
• Annual consumption: 2.094 million tons, accounting for 42.81% of total consumption.
2. Silicone:
• Annual consumption: 1.2588 million tons, accounting for 25.73% of total consumption.
• Monthly consumption increased from 91,600 tons to around 120,000 tons.
3. Aluminum Alloy:
• Annual consumption: 760,800 tons, accounting for 15.55% of total consumption.
4. Export Market:
• Annual consumption: 732,000 tons, accounting for 14.97% of total consumption.

IV．2025 Silicon Metal Market Outlook

(1) Costs
1. Electricity Costs:
• Electricity prices in major production areas (Sichuan, Yunnan, Inner Mongolia, Xinjiang) remain under close observation. With power reforms, some preferential rates have been canceled, and national grid pricing may be applied uniformly in the future.
• Prediction: Electricity costs for silicon metal production will slightly increase in 2025.
2. Raw Material Costs:
• Silicon ore prices are expected to remain stable throughout the year.
• Prices of washed coal, electrodes, and petroleum coke may slightly decline due to low production rates.

(2) Supply and Demand Overview and Forecast

1. 2024 Review:
• Total silicon production: 5.5766 million tons, including industrial silicon production of 4.8918 million tons, 97-grade silicon production of 421,300 tons, and recycled silicon production of 263,500 tons.
• Total consumption: 5.0702 million tons, with an oversupply of 506,400 tons (surplus rate: 9.99%).

2. 2025 Forecast:
• Silicon metal production: Estimated to increase to 5.2 million tons. If terminal demand does not grow, supply-demand imbalance will persist, leading to further inventory accumulation.
• Consumption Predictions:
• Polysilicon consumption share will drop below 40%.
• Silicone consumption share will rise to 27%-28%.
• Aluminum alloy consumption is expected to remain stable at 15%.
• Export market consumption is projected to stay at 14%.

(3) Prices
1. 2024 Impact:
• Polysilicon production cuts had a significant effect on silicon metal demand.
2. 2025 Prediction:
• Some integrated companies will add new silicon furnaces, intensifying oversupply.
• Without favorable policies or major market events, prices are expected to remain low.

Conclusion

In 2025, the silicon metal market will continue to face challenges, including rising costs, supply-demand imbalance, and low prices.