Silicon Metal Market Flash – Procurement Guidance

Supply side firmly tightening – Production cuts are expanding across Sichuan, Yunnan, Inner Mongolia, Gansu, and Xinjiang, driven by rising power costs, sustained margin pressure, and routine furnace maintenance. Plant closures and reduced output are accelerating, with mills holding prices firm or suspending offers altogether.
Futures signalling recovery – The main contract has rallied on policy expectations and supply contraction, confirming growing market confidence in a price floor.
Inventory drawdown in progress – As supply shrinks, excess stock is being gradually absorbed, laying the groundwork for price stabilisation and eventual upward movement.

Polysilicon, silicone, and aluminium alloy sectors continue to purchase on a regular procurement cycle, with stable long-term consumption providing a reliable baseline.
Industry policies supporting downstream segments (e.g., anti-price-war measures in polysilicon) are expected to sustain consumption levels.

Prices have bottomed – Current levels represent a rare entry point before a clearer rebound takes hold.
Supply is declining – Further cuts will tighten availability and potentially push prices higher in the near term.
Secure inventory now – Lock in stable supply at current favourable terms while mills are still willing to negotiate for committed buyers.

With supply contraction firmly underway and cost support strengthening, the market is poised for a gradual price recovery. Early procurement at current levels safeguards against future cost increases and ensures supply chain stability.

Action: Recommended to increase or advance procurement volumes to capitalise on current price floors and mitigate upside risk in the coming weeks.