Industrial Silicon Market Update: Temporary Reprieve Amid Structural Challenges

1. Short-Term Price Recovery Eases Market Sentiment

The industrial silicon futures market has rebounded marginally, providing temporary relief to industry participants. This modest price recovery has helped mitigate the pervasive pessimism from previous declines and reduced panic selling. Notably:

• Production losses are expanding, strengthening price support sentiment

• Manufacturers show increased resistance to low-price transactions

• Market appetite for distressed sales has diminished significantly

2. Persistent Supply-Demand Imbalance

While sentiment has improved, fundamental challenges remain unresolved:

Supply Pressures Intensify:

• Overall market supply remains abundant with no structural improvement

• Flood season electricity price cuts have triggered production restarts

• New capacity additions exacerbate existing oversupply conditions

Pricing Dynamics:

• Divergent strategies emerge: price support vs. competitive discounting

• Increased market volatility reflects active long-short positioning

3. Outlook: Confidence Remains Fragile

The market faces continued headwinds:

• Unabated supply expansion against tepid demand recovery

• Persistent inventory overhang across the value chain

• Limited pricing power among market participants

Key monitoring points:
✓ Flood season production ramp-up pace
✓ Genuine demand recovery signals
✓ Inventory drawdown progress