Executive Interviews

Asian Metal: Welcome, Mr. Zhang, and thank you for joining us today. Could you please begin by briefly introducing your company?

Mr. Zhang: Zhejiang Wynca Chemical Group Co., Ltd. was founded in 1965 and became publicly listed in 2001 (Stock Code: 600596). Our headquarters is located in Jiande, Hangzhou, and we currently operate more than 80 wholly-owned subsidiaries. Our core business encompasses three primary sectors: crop protection, silicon-based new materials, and new energy materials. Within silicon-based new materials, we have developed a comprehensive industrial chain—from silicon ore mining and silicon metal production to silicon powder processing and the synthesis of organosilicon monomers. We also manufacture downstream products such as silicone rubber, silicone oil, and silane coupling agents. Currently, we hold quartz ore reserves of approximately 120 million tons, possess an annual silicon metal production capacity of 250,000 tons, and a silicon powder capacity of 300,000 tons. Our yearly production capacity for silicone monomers has reached 500,000 tons.

Asian Metal: We’ve observed that the operating rate of silicon metal producers in South China was relatively low in early June compared to the same period last year, despite the rainy season. What are the reasons behind this?

Mr. Zhang: This has indeed been a concern across the industry. The core issue lies in persistently low market prices. Since the second half of 2024, demand from the polysilicon sector has continued to decline, while supply has remained high. This imbalance has led to an oversupplied market and high inventory levels. While the combined monthly demand for silicon metal from the polysilicon, organosilicon, and aluminum alloy sectors is about 350,000 tons, total plant and spot market inventory has surged to 1.2 million tons. As a result, prices have fallen to historic lows. By late July, the price of 421-grade silicon metal had declined to approximately RMB 8,500/t (USD1,186/t), while production costs—even during the rainy season—remained around RMB 10,000/t (USD 1,396/t) in Southwest China. Under such circumstances, where “production equals loss,” many producers are reluctant to resume operations.

Asian Metal: What is your current annual capacity for organosilicon monomers, and what is the recent operating rate? How do you see this evolving in the second half of the year?

Mr. Zhang: Wynca’s annual production capacity for silicone monomers stands at around 500,000 tons. Thanks to our fully integrated downstream industrial chain, our operating rate remained high throughout the first half of the year. Recently, the price of silicon metal has rebounded, and a major facility accident further tightened supply, pushing up silicone product prices. We anticipate that the operating rate across the industry will remain stable in the second half of the year, with a limited likelihood of any significant price declines.

Asian Metal: How would you assess the current demand for silicon metal from the polysilicon and aluminum alloy sectors?

Mr. Zhang: Demand from the polysilicon sector remains weak at present. Although some major producers have plans to ramp up output during the rainy season, the overall operating rate hovers around 35%, mainly due to subdued demand from the photovoltaic industry and ongoing industry-wide self-regulation. On the other hand, the operating rate among aluminum alloy producers has remained relatively stable. We are approaching the end of the traditional peak season for aluminum ingot consumption. Meanwhile, the recent listing of aluminum alloy ingots on the commodities exchange has attracted more attention and may inject renewed vitality into the market. We foresee a moderate uptick in aluminum alloy production going forward.

Asian Metal: What is your outlook for the price trend of silicon metal in China in Q3?

Mr. Zhang: The recent rebound in prices has been driven by multiple factors. These include government policies aimed at curbing “malicious internal competition” and eliminating outdated capacity in the non-ferrous metals sector, which have significantly boosted market confidence. At the same time, speculative capital has flowed into the financial market, fueling further price increases. In addition, major producers in Northwest China have reduced output, offsetting the increased production from Southwest China during the rainy season. The extent of this supply reduction exceeded market expectations and accelerated the price rebound. However, real demand in the spot market has not yet recovered. Most buyers are still purchasing on a need-only basis or drawing from existing inventories, maintaining a cautious, wait-and-see stance.

Asian Metal: So, what specific price trend do you expect in Q3?

Mr. Zhang: We anticipate that silicon metal prices in Q3 will remain strong but volatile. The low prices in Q2 suppressed operating rates in Southwest China, causing many producers to reduce or delay raw material procurement. Prolonged shutdowns have also led to workforce departures or layoffs, and the re-hiring process will take time. As such, production recovery during the rainy season may fall short of expectations. Furthermore, the rebound in polysilicon prices—supported by anti-competition measures—is expected to stimulate real demand, helping to further reduce silicon metal inventories. Nevertheless, the eventual commissioning of new production capacity in Southwest China could lead to increased supply, while overall demand remains somewhat weak. Overall, we expect prices to remain firm with some degree of fluctuation. However, once major producers begin hedging and liquidating inventory, prices could begin to soften, potentially bringing more volatility than what we saw in Q2.

Asian Metal: Does your company export silicon metal? What product grades do you export, and what makes your offering competitive?

Mr. Zhang: Wynca began exporting silicon metal as early as 2000 and now has over two decades of experience in overseas markets. We supply a comprehensive range of grades, including 421#, 553#, and 441#, as well as customized specifications such as 4402#, 3303#, 2202#, and 35015#, based on customer requirements. Our exports mainly comprise lump silicon metal (2202, 3303, 421, 441) and silicon metal powder with purities of 3N and above. What differentiates Wynca is the strength of our vertically integrated industrial chain. From silicon ore to metal, and then to advanced silicone products and high-purity powders, we manage the entire value chain to ensure both quality and cost efficiency. We also offer full traceability—from raw materials to finished products—and can provide carbon footprint tracking in line with global sustainability standards. This enables us to deliver a stable, reliable, and sustainable supply chain for our international clients.

Asian Metal: Could you share any new initiatives or strategic plans Wynca is pursuing in the silicon metal sector?

Mr. Zhang: Wynca has always embraced a development philosophy rooted in openness, collaboration, and healthy competition. Looking ahead, our strategy for the silicon metal business is threefold. First, we are upgrading our business model by transitioning from traditional product sales to value-added, brand-driven marketing tailored to specialized market segments. Second, we aim to build a benchmark for green production. Wynca is leveraging clean hydropower resources in Southwest China to advance environmentally friendly manufacturing. Our goal is to establish a leading green silicon metal brand in China that is also recognized globally, in line with international efforts toward low-carbon development. Third, we are expanding our international footprint. While our current exports are concentrated in Japan, South Korea, and parts of Europe, we are actively exploring emerging markets, particularly in Southeast Asia, India, the Middle East, and the Americas. We greatly value professional platforms such as Asian Metal and hope to engage with more domestic and international partners and high-quality clients to jointly promote the sustainable development of the global silicon metal industry.

Asian Metal: Thank you for your insightful sharing, Mr. Zhang.

Mr. Zhang: Thank you.