The world's Silicon Metal market is seeing prices go down. US prices dropped a bit in mid-May, but a recent petition from American companies could shake things up. Over in China and Europe, markets are still under pressure because demand is weak, and freight rates are falling.

Key takeaways:

• Chinese Silicon Metal prices decreased in the week ending May 16, driven by low demand and cautious buyer sentiment.
• In Germany, prices fell due to soft domestic demand and falling freight rates, which reduced import costs and increased market pressure.
• In the USA, silicon metal producers filed petitions for antidumping (AD) and countervailing duties (CVD) on selected imports, which could impact about 27% of U.S. Silicon Metal imports and potentially push prices higher in the short term.

USA

Silicon Metal prices in the USA experienced a slight dip in mid-May, extending a multi-week trend. This occurred despite steady imports from major suppliers like Brazil, Canada, and Norway, and balanced demand.

However, a significant development in the U.S. silicon metal market occurred in late April, as domestic manufacturers like Ferroglobe USA Inc. and Mississippi Silicon Inc. sought the imposition of antidumping duties (AD) on silicon metal imports from Angola, Australia, Laos, and Norway, alongside countervailing duties (CVD) on imports from Australia, Laos, Norway, and Thailand, via petitions to the Department of Commerce and the U.S. International Trade Commission.

This petition targeting Silicon Metal imports could lead to new duties on approximately a quarter of U.S. inbound shipments (27%), excluding major suppliers Brazil and Canada. Should these tariffs be enacted, Silicon Metal CFR prices are expected to see a short-term increase.

China

The Chinese Silicon Metal market continues to face a downturn, with both prices and demand for its raw materials in the doldrums. This weakness is particularly evident in the silicon coal sector, where widespread price reductions are a direct result of contracting demand from downstream silicon plants. Buyers are highly cautious, making only essential purchases, which intensifies competition and pressure on raw material suppliers to lower prices.

Chinese Silicon Metal prices slipped by 0.8% in the week ending May 16^th. Total inventory reached 599,000 metric tons by May 15^th, a 3,000 metric ton week-over-week increase. With both supply and demand softening from April to May, leading to minor destocking, market confidence remains low, suggesting continued weak spot prices.

Talk of a major Silicon Metal plant resuming some production capacity has circulated, yet the precise restart date remains unknown. Looking to June, an expected boost in supply coupled with stable demand could once again ease market conditions.

Germany

German Silicon Metal saw a 1.3% price reduction this period as the domestic market remained soft. Spot prices continued their downward trend, pushing negotiation levels lower. With downstream demand exercising caution and preferring just-in-time procurement, the market lacks strong support. Additionally, the mid-May drop-in freight rates made imports cheaper, helping to drive down overall prices.

A light trading atmosphere persists in the Silicon Metal market, marked by an average industry sentiment and a prevalent wait-and-see attitude. The market is likely to stabilize in the near term, making it crucial to observe evolving supply and demand dynamics and regional price variations.