China's industrial silicon steady over National Day

Industrial silicon prices were broadly stable over the National Day holiday, with most holders keeping offers unchanged from pre-holiday levels.

Market performance

Oxygen-blown 553# silicon in East China was offered at Yuan 9,300-9,400/tonne ($1,386-1,401/t), while 421# silicon in East China was quoted at Yuan 9,500-9,600/tonne ($1,416-1,431/t).

Futures-spot traders have largely cleared their positions, and basis levels strengthened for those still holding material.

The domestic market remains rangebound, with marginal supply contraction coexisting with high inventory. Social inventory of industrial silicon totalled 458,000 tonnes as of September 24, a slight week-on-week decline, but destocking remains difficult and inventories are still historically high.

Producing regions in Southwest China are approaching the dry season. With electricity tariffs expected to rise month by month and raw material costs elevated, in-plant inventories have been drawn down but pressure persists. Prices after the holiday are likely to stay rangebound, caught between rising costs and weak demand.

Downstream

Downstream prices changed little over the holiday, with demand continuing to diverge by sector.

Polysilicon: supported by industry self-discipline initiatives and new mandatory national standards on energy consumption and efficiency, the average transaction price of n-type recharge polysilicon rose to Yuan 43,000/tonne ($6,408/t), about Yuan 10,000/tonne higher than at the end of August. Wafer producers still hold inventory, however, and large-scale concentrated purchasing has yet to begin. More importantly, overall polysilicon operating rates are expected to fall to around 35% from October. If the cuts materialise, October polysilicon output is scheduled at 85,000 tonnes, down 24.78% month on month from September, which would weigh significantly on industrial silicon demand.

Silicones: this segment has been relatively firm, with mainstream DMC offers at Yuan 14,500-15,000/tonne ($2,161-2,236/t), up about 8% from Yuan 13,600/tonne in early September. Monomer plants have maintained coordinated production cuts, hold full pre-sale order books and strictly control external sales, providing essential procurement support for industrial silicon.

Aluminum alloy: the sector continued to benefit from the "Golden September" peak season, with improved orders supporting a moderate recovery in operating rates. High aluminum scrap prices and a tightening tax invoice policy are nevertheless constraining output.

Outlook

Policy uncertainty persists, with the market watching the pace of dry-season production cuts in Southwest China in October and progress on mandatory national standards for energy consumption and carbon emissions in the industrial silicon sector. Should the latter take effect, it would phase out 15-30% of inefficient capacity each year, lifting the industry's long-term cost floor.

On exports, China shipped 509,000 tonnes of industrial silicon in January-August 2026, up 4% year on year. External demand is growing modestly but offers limited relief to the domestic supply-demand balance.

In the near term, the market will remain caught between the pace of destocking and the delivery of polysilicon production cuts. Industrial silicon prices are expected to stay rangebound after the holiday.