Rising Metallic Silicon Spot Price

Metallic silicon 553 offer to Japanese buyers is accelerated to increase recently. The additive to AD12.1 grade secondary alloyed aluminium material for die-casting price offer increased by around US$ 200 or 9% to US$ 2,250-2,300 per tonne CIF Japan in a month. Chinese short supply of electricity lifts the offer when dry weather limits power supply in south China where many refineries have plants.

Japanese sources said usually the refineries increase the production in April when power supply recovers in south China including Guizhou, Sichuan and Yunnan after dry weather season. However, with extremely dry weather, hydraulic power supply is still low this year.

Local governments reduce the power supply to industry including refineries while the governments try to keep power for consumers. Japanese sources said small refineries are forced to stop the operations while major refineries also reduce the operation level.

Refineries usually build inventory in summer and autumn for dry weather season. Japanese industry expects quarterly based contract users can secure the material but spot supply volume decreases widely. Some Japanese alloy makers cannot get any offer recently.

Japanese major alloy makers including Daiki Aluminium, Summit Showa Aluminum and Nikkei MC Aluminium purchase metallic silicon 553 quarterly basis. The offer price was around US$ 2,100 per tonne in early March when the major makers were in price negotiation for April-June shipment. A major alloy maker source said if metallic silicon price increases more, some refineries could adjust the quarterly price higher for April-June shipment.