The current silicone market is still deeply mired in the trough! But a product related to the silicone industry is facing a surge! On June 26th, spot platinum prices rose to a intraday high of $1391.93 per ounce, and the last time they reached this level was in September 2014. Since the beginning of the year, the cumulative increase of platinum has approached 40%, higher than the annual increase of about 30% of gold. In June alone, the price of platinum 9995 on the Shanghai Gold Exchange rose by nearly 30%, and the upward trend is so fierce! It is understood that the rise in platinum prices since the beginning of this year is mainly driven by the imbalance between supply and demand, the hydrogen energy industry, and the investment boom. WPIC predicts that the contraction of platinum supply will remain the core trend in 2025, with total supply expected to decrease by 4% year-on-year to 218 tons, the lowest level in five years. In terms of demand, due to the growth in demand in the jewelry and investment sectors not fully offsetting the decline in demand in the automotive and industrial sectors, the total demand for the year is expected to decrease by 4% to 248 tons, and the shortage is expected to expand to 30 tons in 2025, marking the third consecutive year of shortage. In early June, we asked many platinum catalyst and vulcanizing agent manufacturers, and at that time, most of them said that their recent orders were not good and they would first digest the increase themselves. But with the skyrocketing of platinum, chloroplatinic acid has also risen sharply, causing a significant increase in costs, and the upward trend is still ongoing. The amount of chloroplatinic acid purchased is also limited. In mid to late June, most platinum catalyst and vulcanizing agent manufacturers issued price increase notices, first increasing by 10-15%. Due to the rapid rise, a single negotiation will begin this week, with pricing first and then contracts.
Compared to platinum's rise to a ten-year high, organic silicon bulk raw materials have hit a ten-year low, even a 20-year low! The 'Black June' is coming to an end, and although DMC has stopped falling, its prices are still fluctuating at a low level of 10300-10800 yuan/ton. After a moderate amount of downstream demand replenishment, the willingness to continue buying at the bottom is not strong, and some individual factories' monthly sales have not reached their targets. They are still actively negotiating, and the layout mode of downstream enterprises at low prices remains unchanged. Due to weak terminal demand, the industry generally believes that the probability of a significant rebound in DMC is unlikely. It is expected that market prices will continue to remain stable with small fluctuations in the short term. On the cost side, the Southwest region has a significant advantage in electricity prices during the wet season, and the expectation of furnace start-up is gradually being implemented. Xinjiang's major factories continue to follow up with the resumption of production, and there is a clear expectation of overall production capacity growth, showing strong performance. In terms of demand, polycrystalline silicon enterprises have expectations of resuming production, while the production schedule of silicon wafers and solar cells in the market has decreased, and market sentiment has weakened, with rigid demand procurement being the main focus; In terms of organic silicon, some companies have reduced production, but market transactions have not improved, resulting in limited demand for industrial silicon. Overall, industrial silicon spot prices have continued to hover at low levels under high inventory pressure, while futures prices have continued to digest warehouse receipts, resulting in a temporary recovery and rebound in the market. Yesterday, the main contract price of Si2509 rose 200 yuan to 7720 yuan/ton, an increase of over 2%. However, the fundamentals of industrial silicon are clearly weak, and a short-term rebound is difficult to reverse the situation. In the future, it may continue to experience slight consolidation.