The price hike controversy has not yet subsided! Under the macro boost, the Shanghai Composite Index in the A-share market successfully stabilized at the 3500 point mark yesterday, and the organic silicon sector continued to improve, with Silicon Treasure Technology rising by over 18%! Hongbai New Materials and Chenhua Shares have risen by over 10%! At present, the price of organic silicon market has completely stopped falling and rebounded!
With the strong support of pre-sale orders, individual factories are not only expected to maintain the current price level, but also the supply side has eased recently due to multiple device maintenance, and some manufacturers still have the possibility of further price increases. However, the terminal demand is not strong, and downstream enterprises still remain cautious. During the inventory digestion stage, there has not been a significant release of new essential needs, and the pace of production scheduling is still progressing smoothly and normally. Therefore, in order to achieve a greater increase in market trading volume, we still need to wait for more favorable factors to emerge. Overall, with the balance of demand, although there is an upward trend in the price of organic silicon, the increase may be relatively limited, and the game between upstream and downstream enterprises has not stopped. However, under a series of macroeconomic favorable policies in recent times, the mentality of organic silicon enterprises tends to be cautious and optimistic, and the market may maintain a volatile consolidation pattern in the short term.
Cost aspect: On the raw material side, the Southwest region has a significant advantage in electricity prices during the wet season, effectively reducing marginal production costs. By starting up and resuming production for individual enterprises, the overall supply has shown an increasing trend. On the demand side, polysilicon companies have strong quotations, and downstream silicon wafer factories have also raised their quotations; The prices of organic silicon monomer factories have strengthened, leading to an increase in demand for industrial silicon. Overall, the recent rise in polycrystalline silicon prices has driven a strong linkage between industrial silicon prices, and the improvement in polycrystalline silicon profits will help drive demand for industrial silicon. In the short term, driven by sentiment, it is expected that industrial silicon futures may maintain a strong trend, and the production cuts of large factories will gradually help the industrial silicon market shift from oversupply to supply-demand balance. However, the supply and demand fundamentals of the industrial silicon market are still weak, and it is expected that spot prices will continue to fluctuate within the bottom range, with little room for increase.
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