SMM

In October, both the production and sales of silver nitrate declined. The main reason was that the photovoltaic industry chain generally took a break during the National Day holiday, resulting in only three weeks of natural production days in October. Additionally, the price of domestic No. 1 silver continued to rise in the second half of the month, maintaining a high level above 8,000 yuan per kilogram, which weakened downstream procurement and stocking demand. Currently, the industry chain is accelerating, and shipments are rapid, with domestic suppliers responding very quickly. As a result, the situation where each link in the photovoltaic industry chain holds its own inventory rather than downstream enterprises holding inventory has increased. Under the demand suppression of high silver prices, companies at each link are also engaging in destocking, clearing out previously low-priced stocks. Therefore, last month, the market saw production being less than sales at each link, with inventory reductions across the board. As the year-end approaches, silver prices remain relatively high, making stocking at this price level uneconomical. At the same time, companies need cash flow to cope with the year-end, so November sales will mainly be driven by just-in-time demand. The increase in production days will also bring about an increase in demand, and it is expected that production will rise in November.