Since the beginning of this year, the futures market of industrial silicon has maintained a wide range of consolidation, fluctuating within the range of 8,000 yuan to 9,300 yuan per ton. Recently, the market's "anti-internal competition" sentiment has heated up, and the futures price of industrial silicon has risen again, but it has not broken through the upper limit of the fluctuation range.

From the cost composition of silicon enterprises, electricity cost is the single largest part. At present, the traditional dry season is in effect in Sichuan and Yunnan regions, and the electricity cost is at the high level of the year, with relatively stable cost support. As we enter May, the electricity in the southwest region will gradually shift from the dry season price to the average flood season price, and the production cost of local silicon enterprises will fall significantly, with the single-ton cost of industrial silicon can decrease by 1500 yuan ~ 2500 yuan. Besides the electricity cost, the prices of raw materials such as silicon stone, silicon coal, and petroleum coke are relatively stable, and their impact on the production cost of silicon enterprises is limited.

On the supply side, attention needs to be paid to the recovery pace of the Southwest production area. Specifically, the electricity price in the Southwest production area is currently high, and most silicon enterprises are shut down, with only a few silicon enterprises resuming work at the end of April. The production rate of silicon enterprises in Yunnan area is relatively stable, and some manufacturers have clearly stated that they will resume work in May, with the concentrated recovery time expected at the end of May, and the production release time is expected at the beginning of June. The supply variables in the Northwest production area mainly come from silicon enterprises in Xinjiang. At the end of January, the big silicon enterprises in Xinjiang gradually fulfilled the previous production reduction expectations, and the related reduced production capacity began to recover at the beginning of March, but because of the increase in power costs, the reduced production silicon furnaces did not resume production in full, and the production rate also did not recover to the level before the production reduction. In addition, at the beginning of April, some manufacturers in Xinjiang had maintenance and production reduction; a silicon enterprise in Gansu production area began to shut down and maintain in mid-April, and it is expected to resume production in May; the production rate in Inner Mongolia and Ningxia production area is relatively stable, and there is little fluctuation.

Overall, domestic supply is showing a growth trend, and attention needs to be paid to the resumption of work and production rhythm of silicon enterprises in the southwest and the rotation maintenance of silicon enterprises in the northwest.

On the other hand, the demand side has been relatively weak, with the main variable coming from the polysilicon sector. According to the 2025 industrial silicon market consumption data, polysilicon has surpassed organic silicon to become the largest consumer terminal of industrial silicon. Judging from the current market situation, since the industry self - regulated production reduction in 2024, the polysilicon industry has maintained a large - scale production reduction, with an operating rate of 30% to 35%. In February of this year, the output was only 77,000 tons, hitting a low point since 2023, and the price has also been declining. In mid - April, due to the warming of the "anti - internal competition" sentiment, the polysilicon futures price has rebounded to some extent, but the fundamental weakness pattern has not changed, and the terminal transmission effect is still uncertain, so the price rebound is limited. From the perspective of consumer terminals, in April, with the closing of the "seizing export" window, the demand of the photovoltaic industry chain weakened again, and the price of industrial silicon was under pressure. In mid - April, domestic distributed project inquiries began to increase, and some leading enterprises started to support the price. The "buy up not down" willingness of distributors pushed up the market transaction volume. However, there are still low - priced goods sources in China, the price difference between different goods sources is large, the terminal installation demand has not improved substantially, and overseas orders have not increased. It is expected that the price will continue to fluctuate in the short term.

On the inventory front, at the end of April, overseas customers began to withdraw goods from the bonded area in an orderly manner, and domestic battery companies also started a new round of inventory building. This led to a clear reduction in the inventory of silicon wafers. However, as demand has not seen a substantive improvement and the industry inventory is at a high level of nearly 6 million tons, it is expected that there is no large - scale resumption plan for the silicon material factory in the short term. Entering May, due to the expectation of improved orders for components, orders for battery cells have recovered to some extent, which is expected to alleviate the inventory pressure of industrial silicon.

On the organic silicate side, companies strictly followed the industry's production reduction and control arrangements, with pre-sale orders scheduled until the beginning of May, extending delivery cycles, and inventory under control. Companies are more willing to maintain prices, and it is expected that industrial silicon demand will be difficult to boost in the short term.

Overall, the fundamental weakness of industrial silicon is difficult to reverse in the short term. Not considering other hidden inventories, the current industrial silicon market inventory is close to 1 million tons. During the wet season, the silicon market shows the characteristics of "both supply and demand increase, with supply increase greater than demand increase", and the inventory and warehouse receipts will continue to accumulate, with a large supply surplus pressure. It is expected that the futures price of industrial silicon will maintain a wide range of fluctuations, and the recovery of upstream and downstream enterprises during the wet season needs to be closely watched.

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