Chinese Silicon Metal producers raise prices

Supported by a reduction in supply, the mainstream price of 3-3-03 Silicon Metal has risen by RMB 200/MT (USD 28/MT) compared to early last week, reaching RMB 12,500-12,800/MT (USD 1,767-1,810/MT) EXW Price. However, after the price adjustment, there have been fewer transactions in the spot market. Considering the active overseas inquiries and rising production costs in November, industry insiders expect that the price of domestic 3-3-03 Silicon Metal will increase next week, with more transactions taking place.

A producer from Yunnan revealed that he is currently quoting RMB 12,600/MT (USD 1,781/MT) EXW Price for 3-3-03 Silicon Metal, without offering any concessions even to long-term customers. On Friday, he rejected an order for 100MTs at RMB 12,600/MT (USD 1,781/MT) delivered to Kunming, insisting on RMB 12,800/MT (USD 1,810/MT) for delivery to Kunming. His last transaction was on Tuesday, when he sold 60MTs at RMB 12,600/MT (USD 1,781/MT) delivered to Kunming. The producer stated, “Due to the increase in electricity costs to RMB 0.52/kWh (USD 0.07/kWh) in November, my production costs will rise by RMB 1,000/MT (USD 141/MT), so I am currently reluctant to sell.” He added that he received an increasing number of export inquiries this week and predicted that the price of 3-3-03 Silicon Metal in China would rise next week. This producer has an annual production capacity of 17,280MTs and plans to produce around 1,400MTs in October, the same as last month. His current inventory is around 800MTs.

Another Yunnan producer revealed that he is currently quoting RMB 13,000/MT (USD 1,838/MT) delivered to Kunming, including RMB 200/MT (USD 29/MT) for freight, with no room for negotiation, even though he has not made any sales since the price increase. His last transaction was on Monday when he sold 100MTs at RMB 12,750/MT (USD 1,802/MT) delivered to Kunming. This producer stated, “Due to the rising electricity costs, the production costs in November will be much higher than the current sales prices. Therefore, if the prices remain at this level, we plan to stop production by the end of October.” He expects that, driven by a surge in inquiries from traders and a reduction in supply, the price of 3-3-03 Silicon Metal in China will exceed RMB 13,000/MT (USD 1,838/MT) EXW Price. This producer has an annual production capacity of 17,280MTs and expects to produce 700MTs in October, the same as last month. His current inventory is about 500MTs.