From the perspective of turnover cycle changes, DMC has dropped from a maximum of 60000+yuan/ton to the current 11000+yuan/ton, a decrease of over 80%. The industry believes that there will be slight fluctuations and a stable trend in the lower part of the year, and the month on month decline will gradually narrow. From the perspective of hierarchical enterprises, the inventory scale of top enterprises will remain stable in 2025, while the inventory scale of small and medium-sized enterprises will shrink. Technological innovation is driving the dual improvement of production and efficiency for some small and medium-sized organic silicon enterprises. The latest statistics show that the added value of small and medium-sized industrial enterprises above designated size increased by 8.2% year-on-year from January to April, with operating income reaching 25.8 trillion yuan. Among them, equipment manufacturing and raw material manufacturing industries saw significant demand growth driven by technological upgrades, and 28 out of 31 manufacturing categories achieved growth. A new organic silicon material enterprise in Guangdong has developed organic silicon leather materials that can degrade formaldehyde, and has become a core supplier for many furniture and automotive interior brands at home and abroad. Technological innovation also drives the continuous improvement of the foreign trade market. In April, the export index of small and medium-sized enterprises was 50.4%, which remained in the expansion range for 13 consecutive months, indicating that the overall export momentum is still strong. A functional silicone oil factory in East China reported a significant increase in export orders in May, with a year-on-year growth of 20%.
Last week, the organic silicon market continued its weak consolidation pattern, and the DMC/silicone oil price center further shifted downwards. At the beginning of the week, the market showed a weak trend, with some individual companies taking the lead in lowering the DMC listing price to 11200 yuan/ton, releasing a signal of market weakness. With the significant price adjustment of 400 yuan/ton by wind vane enterprises in Shandong region on Thursday, the DMC quotation was directly lowered to the integer threshold of 11000 yuan/ton. This landmark price adjustment action has attracted widespread attention in the industry and further strengthened the market's bearish expectations.
From a trading perspective, the current market shows a clear trend of "volume price convergence", with large players continuing to maintain their essential needs and not hoarding goods. Although individual enterprises actively accept orders to alleviate inventory pressure, and some manufacturers have even introduced hidden discount measures, downstream enterprises' purchasing willingness continues to be low, and they generally maintain the strategy of restocking for essential needs. This game between buyers and sellers has led to a stalemate in the market, with actual transactions mainly consisting of small and scattered orders. It is worth noting that some downstream enterprises have begun to proactively reduce their raw material inventory cycles due to bearish outlook on the future market, which has to some extent intensified the market's wait-and-see sentiment.
In terms of raw materials, the overall performance of the silicon metal market is stable, but the cost support has weakened compared to the previous period. The price of 421 # metallic silicon remains fluctuating within the range of 8800-10700 yuan/ton, with limited transmission effect on the cost of organic silicon. At the same time, downstream product chain prices have generally declined, with 107 rubber prices dropping to 12500-14500 yuan/ton, raw rubber prices falling to 12800-13500 yuan/ton, and mainstream silicone oil prices falling to 14500-15800 yuan/ton. The synchronous decline of various product lines reflects the sustained weakness of terminal demand.
From the perspective of supply and demand structure, the current market is facing multiple pressures: on the one hand, the operating rate of large-scale individual enterprises remains at around 70%, and the supply side is still sufficient; On the other hand, traditional demand fields such as construction and textiles have shown lackluster performance, while emerging fields such as new energy have not yet formed a scale replacement for growth. In addition, import and export data shows that the overall export volume of organic silicon in April decreased by about 5% month on month, and external demand also showed a contraction trend.
Looking ahead to the future, the industry generally believes that the market will continue to operate weakly in the short term. Considering the traditional off-season for consumption in June, coupled with the lack of significant macro stimulus, it is expected that the benchmark enterprise DMC price may continue to test the key support level of 11000 yuan/ton. However, it should be noted that the current price has fallen below the cost line of most individual companies. If the price continues to decline, it is not ruled out that some companies may actively reduce production to balance supply and demand, which may bring temporary stabilization opportunities to the market. It is recommended that market participants closely monitor the dynamics of upstream equipment and changes in terminal demand, and flexibly adjust their procurement pace.
Big spenders suddenly announce massive layoffs! China American Chamber of Commerce News: From May 23rd to 28th, a survey of 112 companies in China and the United States showed that only 26% of the companies stated that they were not affected by tariff issues, while most companies stated that tariff measures significantly increased costs and reduced revenue. The tariff measures have increased operational challenges for Chinese and American funded enterprises, but most companies have no plans to withdraw from the Chinese market, and no company has expressed plans to relocate production capacity back to the United States. Procter&Gamble, one of the major downstream demand players for organosilicon, announced on Thursday that it plans to lay off 7000 employees in the next two years, accounting for approximately 15% of its global non manufacturing positions. As of June last year, Procter&Gamble had approximately 108000 employees worldwide. Procter&Gamble's Chief Financial Officer Andre Schulten announced at an industry conference in Paris that the company will launch a two-year restructuring plan in the next fiscal year. The plan includes measures such as business portfolio adjustment, supply chain optimization, possible exit from certain brand categories, and layoffs, with an estimated cost of between 1 billion and 1.6 billion US dollars.
Single unit device dynamics: Last week, the operation of domestic organic silicon devices showed regional differentiation: the leading devices in Northwest China gradually resumed production, while some devices in North China continued maintenance; The operating rate of the other two mainstream facilities remains at around 70%, driving the overall supply of the industry to rebound and significantly increasing market supply pressure. Against the backdrop of capacity release, individual factories are actively offering discounts on shipments due to inventory pressure, causing product prices to drop again in the historical low range, and negative market sentiment is pervasive. Follow up outlook: The current price has reached the loss line of most enterprises, and the industry's passive pressure to reduce production has intensified. According to industry feedback, if the demand side continues to be weak, some individual units may actively expand their production reduction scale to alleviate the supply-demand contradiction. It is recommended to focus on the adjustment of operating rates and the support of cost lines for mainstream manufacturers.
DMC market dynamics: Last week, the domestic DMC market fell, with prices of some grades dropping by 100-400 yuan/ton to 11000-12500 yuan/ton. The DMC market in South China tends to experience soft consolidation. After the phased filling of gaps, the trading atmosphere in the market weakened.
107 rubber market dynamics: Last week, the domestic 107 rubber market experienced local fluctuations, with some grades fluctuating by 100 yuan/ton in market prices, and transactions mostly exceeding 13000 yuan/ton. The leading quotation range remains stable, with limited guidance for the market. The ex factory price of East China 107 adhesive is stable, and the spot market offers are narrow and organized. The overall trading atmosphere in the market is weak, and some merchants are cautious in offering discounts for shipments. Downstream silicone adhesive factories purchase according to demand and negotiate actual offers.
Silicone oil market dynamics: Last week, the domestic silicone oil market remained stable, with mainstream market prices fluctuating by 50-100 yuan/ton. After the holiday, there is a certain amount of shipping pressure in the market. Although it is difficult to find a direction unilaterally, some merchants are showing signs of offering discounts, and prices are mainly declining. It is reported that domestic methyl silicone oil is priced at 14800-15500 yuan/ton, foreign brand silicone oil is priced at 18500-19000 yuan/ton, and cracking material silicone oil in South China is priced at 12700-13500 yuan/ton (excluding tax).
Market dynamics of raw rubber: Last week, the raw rubber market experienced slight fluctuations, with some grades fluctuating by 50 yuan/ton in market prices. The domestic raw rubber spot market has a strong quotation, and the intraday transaction price has fluctuated and decreased with the market. After the holiday, the production of raw rubber equipment has resumed, and the market supply has increased. The delivery of exports has slowed down, and new orders have entered the off-season, increasing market supply pressure. The core large-scale transactions are around 12500-12700 yuan/ton.