In this blog, by Procurement Resource, it is stated that silicon is a vital commodity with a wide range of applications. It is also used to make silicone that is further used in making lubricants, adhesives and sealants, chemicals etc., which boosts its demand. Furthermore, the post covers the key market players and regional price trend analysis.
Silicon: What is it?
Silicon (Si) is a non-metallic chemical element belonging to the carbon family of the periodic table. It makes up around 27.7 percent of the planet’s crust, making it the second most abundant element in the world. Its atomic number is 14, and the most common isotope with an atomic weight of 28.0855 g.mol -1. Its melting, and boiling points are 1414°C and 3265°C, respectively.
Silicon Market Applications And Dynamics
Silicon finds its application in a motley of industries and across a range of applications. Encompassing energy production sectors, the aviation industry (as a component of various aircraft owing to its outstanding capability of withstanding high temperature), paints production (for a long-lasting effect), cosmetics industry (as a phenomenal solvent for various products imparting smooth finish), kitchenware, silicon marks a notable importance for itself.
The growing demand for aluminium-silicon alloys is driving the silicon market. Furthermore, the consumption of silicon metals is rising due to the increased demand for electric vehicles as well as boosted automobile production worldwide. In addition, the rising usage of smart cellular phones, tablets, laptops, and other electronic gadgets is further propelling the market growth.
Additionally, silicon is the most widely-used semiconductor material in solar cells which is boosting its demand. Moreover, metallurgical silicon, when purified, can be transformed into high-purity silicon, which is the base of semiconductors or solar cells. As a result, its use in solar cell production is driving the market forward.
Also, silicones and aluminium alloys made from silicon are employed further to produce products like lubricants, adhesives and sealants, chemicals etc., which is furthering the market’s expansion. Hence, the product’s versatile applications across industries like automotive, industrial, building and construction which is further bolstering the market demand.
Silicon Production Via Reduction
The silicon production method uses the reduction process, which mainly includes reducing quartz along with carbon at high temperatures of about 2000 °C, which is carried out in an electric arc in a reduction furnace. The mix of several carbon materials, including coal or charcoal, and coke, gets fed with quartz into the reduction furnace. Next, liquid silicon gets attained through the furnace tap hole at a temperature of 1600 °C. At last, the metal gets processed via oxidative refining, casting, crystallization and crushing.
The Silicon Market Key Players
- Zhejiang Kaihua Yuantong Silicon Industry Co., Ltd.
- Zhejiang Zhongcheng Silicon Co., Ltd.
- Ferroglobe PLC
Silicon Price Trend 2022 Segmented By Region
In the US silicon market, prices persisted in dropping because of an imbalance in demand and supply which was driven by imports and consistently declining prices of raw materials. The import sources of the United States extended to comprise Canada, Venezuela, Brazil, and Russia, among others. But, the market players conveyed that the silicon from China was trivial. The market players note that the pressure of costs stayed high during the end, with news of supply chain challenges, shortages of raw materials, as well as soaring silicon production cost for essential inputs like energy and electronics. The market players considered that prices of silicon in the United States had dropped, with close-term sentiment slowly improving, although the general tone continues to be cautious.
The silicon price trend in the market in Asia stayed stagnant recently. As per the market players, the price of silicon in July was below what was anticipated. Manufacturers scheduled the production and maintenance. A few traders felt the price was underwhelming compared to their expectations and were keenly waiting for ferrosilicon purchase demand. In addition, costs of raw materials have dropped, and margins are slowly returning. As a result of the surplus of resources in circulation, downstream industries are worried about the market outlook. Owing to busy shipments, the Huangpu Port silicon inventory was lowered, while the Tianjin Port stock stayed steady. Furthermore, the downstream bought as per requirement, and a few traders managed to stockpile cargo beforehand. The cargo holders raised silicon prices many times during September, mainly because the market was worried about restrictions on production along with shipment problems amidst the Xinjiang pandemic.
Recently, the prices of silicon in the European market dipped because of a surplus of inventories in the domestic market and restricted demand. As per the market players, prices of silicon have stayed steady as a result of higher-than-expected purchase volumes in Europe, as well as the restricted supplies of polysilicon due to seasonal mill closures. As per the purchasers, prices of German power and gas have more than doubled in over two months. In the past, temporary shutdowns have happened due to increased costs. As the prices increase, multiple energy-intensive companies contending on a worldwide scale are handling the pinch. Clients are spending more as silicon firms substitute liquefied petroleum gas and coal for around 40% of gas volumes from Germany. Hence, the market saw a steady demand outlook.
Silicon Economics in 2023.
Silicon trend in 2023 seems to be a bit on the debilitating side owing to the supply glut. Moreover, the haphazard logistics seem to be furthering the exacerbation in the condition of silicon market, at least during the initial months of the year. The added capacity and logistics disruption couldn’t be predicted in optimism for the first quarter of 2023
Hence, the following blog covers the market dynamics of the silicon commodity. It also includes the price trend of the commodity, which is done on the basis of the region, which gives an idea of the current market state. As a result, it can be seen that silicon is a vital commodity that is employed in a wide range of applications which makes its sourcing crucial. However, the right approach, dynamics affecting the price trajectory, economic implications, etc. holds a cardinal essence as prerequisites.