Quarterly Update on Global Silane Market
For the Quarter Ending June 2021
Q2 brought a much-needed recovery in the regional Silane demand as end-use operations picked up to cope with the market rebound. Producers reported continued logistic delays as the key factor restricting the regional availability of the product. The region reported higher downstream semiconductor grade polysilicon sales volumes due to pick up in the semiconductor sales. The market players reported overseas shipping limitations that affected the timing for order fulfilments. Prices went through roof as traders stocked up inventories in fears of material shortage. However, weak demand for solar cells cell worried the Silane manufacturers who faced immense cost pressure and squeezed production margins.
While several economies in the Asia Pacific faced resurgence of COVID, regional Silane manufacturers reported strong demand from the electronics sector as the key market driver amidst all challenges. The Asian Silane demand remained healthy amidst market optimism with vaccines roll out and strong consumer activity. However, some suppliers reported logistic delays in the return of vessels from the Asian countries like Taiwan, Korea, Japan, and China. With huge capacity additions scheduled in Korea and China in H2 2021, the regional Silane gas market is anticipated to register phenomenal growth in the upcoming quarters. Prices in general were on a downtrend (around 3% lower over Q12021), despite high operational costs and better demand.
The European Silane industry reported continued tightness in the market supplies amidst firm Polysilicon demand and delayed imports. The market players reported strong gains in the downstream solar module prices and other downstream material constraints due to critical shortage of the key raw material Silane which could be seen resolving by the end of Q2. Prices surged tremendously eld by persistent shortage in market supplies. Wacker Chemie AG (Munich, Germany) started the construction of a silane and liquid resins unit at its Nünchritz, Germany site. The company’s Nünchritz site will convert silanes into silicone products which would be used in the construction and coating applications.
For the Quarter Ending March 2021
Several Silane gas producers reported higher demand for silane-based products in photovoltaics and for TFT/LCD manufacturing with the sharp rebound in the economic outlook. Prices rose in response to various market conditions and economic factors including ramped up manufacturing, rising distribution costs, high demand and tightening raw materials. With a marked growth in semiconductor content in electronic systems during the quarter, the demand for Silane gas in chemical vapor deposition jumped by double digits. But the supply got disrupted after the winter freeze halted the production at several production facilities in mid-February which was compounded by blockage at the Suez Canal for nearly a week, which choked off semiconductor chips headed for Europe.
Europe reported sharp rebound intheSilane prices during Q1 due to macroeconomic uncertainties. Translating strong increases in the raw material costs and global inflation in ocean freight, the European Silane producers preferred to raise Silane prices during the quarter. German multinational chemical company WACKER AG announced to raise the prices for all its silicones product range including Silanes amidst fuming raw material rates and supply shortage. The upward revision in the price was between 10 and 20 percent for all its shipments across the globe scheduled from April onwards. The company also stated strengthening cost for packaging materials and pandemic related constraints as the additional factors supporting the uptrend.
In Asia, a sharp economic rebound enabled semiconductor industry to report robust sales in Q1 2021, thereby prompting high demand for silanes and its derivatives. But the industry reported a sharp rise in Silane gas prices due to high demand and raw material shortages. Chinese Lunar New Year holidays exacerbated the Asian Silane market tightness, but the market remained optimistic with the government vastly increasing investment in the semiconductor industry. Prices remained stable in South Korea where the downstream polysilicon industry faced Chinese competition.
For the Quarter Ending December 2020
In Asia, the COVID 19 recovery prompted countries to register sharp regain in semiconductor industries during Q4 2020. Transit Fluorine Silicon Materials, a major silicon manufacturer of China had a fire at its plant during November. That declined the supply of Silane gas and created shortage of silicon for multiple industries within China and other importing countries like India as well. Although the overall demand of silicon related products was low in India compared to same quarter last year, sentiments turned favourable on Q-o-Q basis.
Europe reported strong recovery intheSilane market during Q4 2020 compared to prior quarter. A major manufacturer of Silane in Norway reported improved sales volume in the final quarter. The regional Silane market was largely dealing with sufficient supply due to reduced export volumes towards the end of the quarter. Persistent shortage of containers in December directed prices to rally upwards, registering a rise of about 2.8% within the quarter. In addition, demand of Polysilicon in the region was rallying up in the same quarter. As an effect of this rise, the demand of Silane gas witnessed incredible increase during the quarter.
During October, REC Silicon ASA and Violet energy corporation collaborated to build a Silane gas based solar cell manufacturing unit. REC would invest USD 1.7 billion on the project to satisfy the immediate requirement of solar cell of violet plant. This unit will definitely raise the demand of Silane gas and will increase the availability of solar cell within the region. The US government was heard investing and making policies to shift the solar cell market from China to US itself, this shift is likely to push the regional Silane gas demand.