Silicon Industry Branch: Industrial silicon spot prices fell first in August and then stabilized, and overall market transactions were poor

The Zhitong Finance App learned that on August 30, the Silicon Industry Branch released the silicon industry price analysis and outlook for August. The spot price of industrial silicon fell first this month and then stabilized. Overall market transactions were light. In the first half of the month, manufacturers made concessions to ship under inventory pressure, compounded by falling futures markets. Pessimism was strong, and prices fell. In the second half of the month, the market was mainly wait-and-see, and spot manufacturers' prices remained stable overall.

On the supply side, manufacturers in the southwest region are in a period of abundant water, with low costs and high construction starts. There was no significant reduction in production by leading companies in the northern region. However, at the end of the month, electricity restrictions in the Leshan region of Sichuan due to high temperatures, combined with a small number of manufacturers stopping furnaces and cutting production in the early stages, the overall supply decreased slightly compared to the previous month. On the demand side, silicone construction started at around 80%, and procurement was carried out as needed. Aluminum alloy companies resumed production in September, and a small amount was still needed to be purchased throughout August. The schedule for polysilicon production this month was reduced compared to the previous month, and overall demand decreased.

There are certain difficulties with spot manufacturers shipping in August. Spot prices have a certain advantage over spot manufacturer prices, and spot prices are under pressure. Leading manufacturers raised their prices at the end of the month, which had a certain effect on the market. Combined with market increases, it is expected that prices may rise slightly in the future. However, the fundamentals of overall supply and demand are still relaxed, and the increase is limited, and the bottom is still dominated by fluctuations at the bottom.

In August 2024, the price of polysilicon in China remained stable. The price of N-type polysilicon rose slightly from 40,400 yuan/ton to 41,000 yuan/ton during the month, an increase of 1.49%. This month is the first increase in polysilicon prices in recent months. The main reason for the price increase is the slowdown in market supply growth caused by drastic production cuts by polysilicon companies. Most raw material inventories are held by manufacturers, and downstream silicon wafer raw material inventories are unevenly distributed.

At the end of July and the beginning of August, traders and futures traders gradually began to lay out polysilicon futures. They are more willing to buy polysilicon at higher prices, the scope of inquiries is wider, and some non-mainstream small orders are sold at higher prices. In the middle of the month, due to the fact that some silicon wafer companies' raw material banks were basically exhausted, the original cooperative raw material suppliers were undersupplied due to factors such as discontinuation of production and maintenance, and some companies switched factories to raise prices to make up supplies, and some large polysilicon orders were sold at higher prices.

So far, there has been a substantial slight increase in the price of polysilicon. Polysilicon orders were basically signed at the end of the month. Most companies mainly executed early orders, and market prices remained stable. In summary, the rise in polysilicon prices in August was due to a combination of factors such as rapid narrowing of supply, unexpected downstream inventory replenishment, and increased procurement efforts.

In September, silicon wafer companies' production schedule was lowered to around 45 GW. Demand for silicon materials declined rapidly. There is a possibility that the supply of polysilicon will increase during the same period, and the balance between supply and demand for polysilicon deteriorated further. Apart from purchases by traders, polysilicon prices have not seen any other growth points, so it is expected that silicon prices will be difficult to maintain their upward trend.