Silicon: production and consumption (review and forecast of the market situation)

According to the U.S. geological services in 2006 the World production of metallic silicon reached 4.7 mln tons. An insignificant drop occured in comparison with the year 2005, when production reached 4.72  mln.  tons. China remained the principal producer of silicon whose share actually comprises practically a half of the world production – 2 4 mln. tons. The second and third places are occupied by  – Russia and Norway with levels of production of 600 000 tons and 270 000 tons.
The consumption of metallic silicon left supply behind. According to the estimates of the Landsbanki kepler investment bank, in 2007 the deficit of silicon comprised 5000 tons, while in 2008 its growth is forecasted to reach 6000 tons. In the view of the analysts such a situation suits the producers of silicon, who gain substantial profits. There were no reports of the growth of production being planned.
Principal fields of application of metallic silicon – production of aluminium and its alloys and chemical industry.
High purity silicon is used in the semiconductor industry and in the production of chips of integral schemes for computers. However, according to Metal Bulletin’s statistical data the amount of  silicon, used in those applications, is negligible and comprises less than 5% of the total demand for the metal.
In the years 1999 – 2006 the prices for metallic silicon stayed at a level of 1200-1400 euro/ton. In 2006 a situation occurred in the market when the demand outstripped supply. Prices started to rise, in November-December 2007 they rose up to 1800 euro/ton. According to the forecasts the market situation in 2008 shall not change, and the prices shall continue to rise. At the beginning of January 2008 the prices in the free market reached 1900-2000 euro/ton.

According to materials:
Metal Bulletin Monthly, 2007, December
Metal Bulletin, 2008, January, 7
Metal Bulletin, 2007, №9021