Japan steelmakers raise silicon carbide usage as ferrosilicon substitute on lower prices
Tokyo (Platts)--22Feb2013/559 am EST/1059 GMT
More and more Japanese steelmakers are using silicon carbide instead of
ferrosilicon, as it has become a cheaper alternative due to a supply glut in
solar-grade silicon, market sources said Friday.
Silicon carbide, which is used for silicon-based solar cells and
semiconductor devices, has become widely available amid a downturn in the
solar sector, the sources said.
"The increased availability of silicon carbide supply following a slump
in the solar sector, has caused Japanese mills to turn to this material as a
substitute for ferrosilicon. Ferrosilicon's position as one of the major
[melting and desulfurization] agent is slipping," said one Japanese trader.
Currently, silicon carbide with around 80% silicon content costs
$1,000-1,100/mt on a delivered basis, a mill source said. In comparison, the
spot import price of Chinese-origin ferrosilicon this week stood at
$1,400-1,420/mt CIF Japan, according to Platts' assessment.
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As such, silicon carbide is 20% cheaper than ferrosilicon with 75%-Si
content, the mill source said.
An electric arc furnace operator which uses over 4,000 mt/year of 75%-Si
ferrosilicon, has cut usage by 10% in 2012 as it started to use silicon
carbide briquette (80-90% Si) during the ferrous scrap melting process.
"Our plant started to use silicon carbide in 2011 on a test basis and
has replaced around 10% of our ferrosilicon requirement with it in 2012," the
source said.
Japanese traders said integrated steelmakers, which consume ten times
more ferrosilicon, have also started using more silicon carbide.
The mills typically used low-grade ferrosilicon of less than 70%-Si as
melting agent, but are using more silicon carbide in the last year or so, to
save production costs, said traders.
But one Tokyo-based trader said if supply of silicon tightens, the mills
are likely to switch back to using more ferrosilicon.
The mills were using less silicon carbide five years ago, because prices
were higher than ferrosilicon, he said.
Japan imported 460,875 mt of ferrosilicon with over 55%-Si content in
2012, down from 470,398 mt in 2011.
--Mayumi Watanabe, mayumi_watanabe@platts.com
--Edited by Haripriya Banerjee, haripriya_banerjee@platts.com