Industrial Silicon Industry Information Weekly Report

Issue 13

Sichuan Nabi Silicon-based Materials Research Institute

May 6, 2022

I. Macro articles

(1) Economic Development

1. [In April, China's logistics industry prosperity index continued to fall to 43.8%, down 4.9 percentage points from the previous month] China Federation of Logistics and Purchasing released: China's logistics industry prosperity index in April was 43.8%, down 4.9 points from the previous month percent. The control measures taken due to the recurrence of the epidemic have significantly affected the efficiency of domestic logistics, and further had a substantial impact on the procurement of raw materials for the manufacturing industry and the sales and circulation of products. In this regard, the Group's industrial enterprises in production should strengthen the monitoring of logistics smoothness to prevent construction and production plans from being blocked due to poor logistics.

2. [National Bureau of Statistics: Manufacturing PMI in April was 47.4%] In April, the Manufacturing Purchasing Managers Index (PMI) was at 3 On the basis of falling below the critical value of 50 for the first time in March, it continued to fall to 47.4%, down 2.1 percentage points from March. In terms of sub-indices, the production index was 44.4% (down 5.1 percentage points month-on-month), indicating that manufacturing production activities slowed down significantly; the new order index was 42.6% (down 6.2 percentage points month-on-month), indicating that the manufacturing market demand has declined significantly ; The raw material inventory index was 46.5% (down 0.8 percentage points month-on-month), indicating that the inventory of major raw materials in the manufacturing industry continued to decrease; the employment index was 47.2% (down 1.4 percentage points month-on-month), indicating that the employment prosperity of manufacturing enterprises has declined; The supplier delivery time index was 37.2% (down 9.3 percentage points from the previous month), indicating that the delivery time of manufacturing raw material suppliers has slowed down significantly.

Domestic manufacturing industry is facing two-way pressures of supply and demand. The Group's industrial enterprises should pay close attention to downstream demand trends and upstream raw material price fluctuations, and combine with the market rhythm to be reasonable Schedule purchasing and production planning

(2) Element Control

1. [Development and Reform Commission: Coal production enterprises should sign medium and long-term contracts in strict accordance with no less than 80% of the annual coal output] The National Development and Reform Commission held a special video conference on the signing and performance of coal medium and long-term contracts. The meeting demanded that all relevant parties should deeply grasp the current situation, fully understand the importance of medium and long-term contracts to ensure coal supply and price stability, and effectively sign, sign, and standardize medium and long-term contracts, and strictly perform contracts. Relevant departments will strengthen the assessment of the performance of contracts signed by local and central enterprises, and those who do not perform well will be notified, interviewed and held accountable.

This policy has formed a policy support for the guarantee of power supply in 2022, and the possibility of recurrence of power supply shortage in 2022 should be effectively controlled.

(3) Currency and Capital

1. [The central bank increases the special re-loan quota of 100 billion yuan to support coal development and utilization and enhance coal reserve capacity] With the approval of the State Council, the People's Bank of China has increased the special re-loan quota of 100 billion yuan to support the clean and efficient utilization of coal, which is specially used to support coal Develop, use and enhance coal reserve capacity. The areas of new quota support include safe coal production and reserves, as well as coal power companies' guaranteed supply of thermal coal. After the increase of 100 billion yuan, the total amount of special re-loans to support the clean and efficient utilization of coal will reach 300 billion yuan, which will help to further release advanced coal production capacity, ensure safe and stable energy supply, and support economic operation within a reasonable range.

This policy also forms a policy support for the guarantee of power supply in 2022, and the possibility of recurrence of power supply shortage in 2022 should be effectively controlled.

(IV) Environmental protection and safety

——no

Second, the middle view

(1) Industry supply and demand

1. [Industrial Silicon Weekly Review: Prices remain stable overall] Affected by the May 1st holiday, the mainstream prices of metallurgical grade and chemical grade industrial silicon did not change significantly from last week, the downstream DMC price remained unchanged, and the aluminum alloy ADC12 held The price of industrial silicon FOB in the export market remained stable.

In terms of demand, the market continued the wait-and-see pattern before the holiday, and the market transaction was light. Although downstream enterprises in Jiangsu and Zhejiang have resumed work and production in the context of the obvious improvement of the epidemic during the holiday, the relevant demand has not fully recovered;

In terms of supply, silicon factories in the southwest are more motivated to start construction, especially in Sichuan. As of the beginning of May, the number of furnaces opened in the province has reached more than 50, and the supply is relatively large.

Therefore, under the background of weak market demand but a significant increase in supply, the downstream wait-and-see atmosphere is relatively strong, and the purchasing enthusiasm is not high. It is expected that under the influence of multiple factors such as the release of polysilicon and organic silicon production capacity, the growth in demand for alloy silicon, the overall downturn in the automotive industry, and the steady increase in the supply of industrial silicon, the price of industrial silicon will remain stable.

(2) Technology and economy

——no

(III) Industry development trend

1. [April month-on-month delivery of new car-making forces fell collectively month-on-month, or the growth rate of the auto market was lower than the forecast at the beginning of the year] Recently, new car-making forces have The delivery data for April will be announced one after another. Affected by the epidemic and the supply chain in April, factories and supply chains in many places were shut down. The delivery volume of the five new car manufacturers all declined month-on-month, and the delivery volume did not exceed 10,000. The data of NIO and Li Auto were significantly higher than the same period last year. decline. At present, the retail targets of major auto manufacturers have fallen sharply year-on-year. According to Xu Haidong, deputy chief engineer of the China Automobile Association, the overall judgment of the auto market in 2022 may not reach the 5% growth rate predicted by the China Automobile Association at the beginning of this year, and The shortage of chips still has a continuous impact, which may have a certain impact on the supply of my country's own brands and the entire auto market.

The growth of the automotive industry is hindered by various factors such as chips, raw materials, logistics, macroeconomic downturn, etc., which may be expected to weaken through the expected weakening of silicon aluminum alloy demand Industrial silicon prices will have an impact in the second half of the year.

2, [Huasu shares: to invest 1.85 billion Yuanjian 200,000 tons of organic silicon project per year]Huasu Co., Ltd. issued an announcement: It plans to invest 1.85 billion yuan to build a new 200,000-ton organic silicon project. The project adopts mature technology to synthesize methyl chloride by catalytic method, and then uses methyl chloride and silicon powder to synthesize methyl chlorosilane mixed monomer in a fluidized bed reactor, and finally passes Distillation to separate out a variety of high-purity monomers, mainly dimethyl monomer (M2), and finally prepare mixed methylcyclosiloxane (DMC) by hydrolysis of M2). The company's chlor-alkali production unit can provide hydrochloric acid for the project, the enterprises in the park where the project is located can provide a stable supply of methanol for the project, and the silicon block is purchased through the basic raw material market. The planned construction period of the project is 18 months, and it is expected to be completed and put into operation in the first half of 2024.

3, [Chint Electric sells photovoltaic module business] listed The company Chint Electric released an announcement on the sale of its photovoltaic module business. The company sold all the photovoltaic module business to the controlling shareholder Chint Group at a consideration of 2.25 billion. As the world's tenth largest module supplier in 2021, Chint Electric will sell its PV module business mainly based on the continued high price of upstream silicon materials and other raw materials, which will have a significant adverse impact on the downstream module manufacturing business. The company's photovoltaic cell module gross profit margin is only 6.49% , ranked last among all its products. In order to maintain the certainty and stability of the listed company's profitability, this asset sale arrangement is made.

Combining the motives of Chint Electric's asset sale and the trend of vertical integration of leading companies in the photovoltaic industry, under the background of the long-term improvement of the photovoltaic industry, the concentration of the photovoltaic industry may continue to increase in the future. Only companies with advantages in capital, capital and model can continue to exist.

Third, microscopic articles

(1) Process and equipment case

——not yet

(II) Operation and Management Cases

——not yet