Some Chinese silicon metal traders have brought forward March buying to February, on worries of a logjam after the Lunar New Year holidays, China Nonferrous Metals Industry Association said in its monthly report Tuesday.
CNIA said most producers in Xinjiang Uighur Autonomous Region, Northwest China had already finished signing pre-Lunar New Year silicon contracts with the downstream sector back in mid-January, with some traders having brought forward replenishing stocks for March to this month as they expected transport delays after the holidays.
Xinjiang produced 77,000 mt silicon in January, flat from December, CNIA data showed.
As of January 31, Chinese domestic prices for 553 grade silicon at Huangpu Port, Guangdong Province, South China were Yuan 12,300/mt, up Yuan 150 from the end of December, CNIA data showed.
It said the higher price was due to tighter supply as domestic environmental protection measures have tightened raw material supply, making it hard for silicon producers to operate.
In Yunnan Province, Central China, a key Chinese silicon production base, provincial silicon output was 28,000 mt in January, down 39% year on year, CNIA data showed.
The drop was attributed to some producers having advanced their annual overhaul on the dry winter weather. Silicon production in China is highly dependent on hydro-power.
China's national silicon exports in 2017 hit 827,000 mt, up 21% year on year, data from the General Administration of Customs showed.
The association said higher exports were due to two silicon producers overseas having raising buying from China, so boosting exports to Germany and UK.
Also, the US' antidumping and anti subsidy probe against Brazil, Norway, Australia, Russia and Asian nations in early 2017 have spurred some silicon furnaces there to shut for overhaul, so causing overseas buyers to turn to China, it said.
Moreover, the Thai car sector boomed last year, also feeding demand for Chinese silicon, CNIA said. China exported 66,000 mt silicon to Thailand in 2017, up 31% year on year, customs data showed.
Looking ahead, CNIA forecasts demand for Chinese silicon will slow before silicon contracts are signed for the second quarter as some traders have already replenished stocks on fears of post Lunar New Year transport problems.
It predicted domestic 553 silicon prices in the coming few weeks to be in the range of Yuan 13,000-13,300/mt, up Yuan 200-300 from the end of January, citing rising power costs cutting producers' operating rates.
