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In September, the market price of Silicon metal in China continued to soar. As of September 14, the reference price of Silicon metal in China was $5,540 / ton, more than 2 times higher than the price of the same period in 2020, breaking all kinds of price records.

The reason for the explosive growth of silicon metal this time is cost rise and imbalance between supply and demand. There are mainly the following four points:

First, the cost is mainly the cost of raw materials and electricity, and the cost of producing silicon metal is mainly the cost of electricity. After the end of this year's wet season, the price of electricity has risen, and the production cost has also risen.

Second, due to the epidemic situation, many foreign silicon metal manufacturers cannot produce normally, and the international demand for silicon metal has not decreased, but we have done a good job in controlling the epidemic situation. So foreign inquiries have not stopped for nearly a year. 

Thirdly, in August, due to various reasons, the silicon factories had power outage for maintenance, so the output has not come up. Silicon metal products are often in short supply.

Fourth, the influence of national environmental supervision and "carbon neutral, carbon peak" policy.

The above is the analysis of the reason why our company brings you the soaring silicon metal. Whether domestic or international news, metal silicon prices rise within a reasonable range. As an enterprise with high energy consumption density, silicon metal plant has a strong impact on local energy consumption index control. Later silicon metal new capacity investment and construction plan implementation may be more complex. Upgrading existing capacity may be one of the short-term solutions to tight supply.

Due to the dual control policy of energy consumption and the implementation of power restriction policy, silicon metal production capacity cannot be fully released, and there is still potential for the release of silicon metal production capacity in the later stage. Currently, it is mainly limited by energy consumption policy and power supply problems. Silicon metal supply is expected to remain tight in the second half of 2021, and silicon metal prices are expected to hit new highs in the second half of 2021.