According to the International Monetary Fund, the United States' imposition of tariffs will reduce global demand in the short term, leading to an increase in import prices and further exacerbating inflationary pressures. The uncertainty of tariffs may also weaken consumer and business confidence and exacerbate financial market volatility. It may lead to further raising trade barriers among countries, thereby exacerbating geo economic fragmentation. Industry insiders believe that tariff changes will continue to push up the export prices of organic silicon, and the order volume may slow down.
On Thursday, the organic silicon market continued its upward trend, and the bullish sentiment in the market heated up. The DMC quotation of Shandong benchmark enterprise was raised to 12300 yuan/ton, a cumulative increase of 2200 yuan/ton from the beginning of the month. Other individual companies' quotations have risen to the range of 12500-12800 yuan/ton. Relevant personnel from Hesheng stated that this increase is closely related to the shutdown and maintenance of major manufacturers, and they hold an optimistic view on the future trend of organic silicon prices. News from Silicon Cloud Online: The supply gap continues to ferment, and the rise of organic silicon may continue until the end of the month. This week, the organic silicon market experienced a comprehensive price increase driven by costs and unexpected events, with severe market fluctuations and a rapid recovery in market sentiment. The industry's transaction volume nearly doubled.
On the cost side, industrial silicon futures continue to strengthen, with 421 # spot prices rising to 10400 yuan/ton. The Xinjiang region continues to suppress production, and macro commodity sentiment is relatively strong. There is a possibility of a "positive cycle" pushing up, and the strong performance of industrial silicon is transmitted to downstream individual factories, creating a strong atmosphere of reluctance to sell and price increase. On the supply side, 25% of the production capacity (approximately 90000 tons) of Dongyue Zibo Phase III's 350000 tons/year plant has been damaged, and there is no timetable for resuming production. Other manufacturers have limited inventory, and spot circulation has sharply decreased, causing supply chain interruption panic. After the collective closure of several individual factories such as Luxi, Xin'an, and Xingfa, the industry's operating rate quickly fell from 72% last week to below 70%. On the inventory side, as of last week, the domestic inventory of organic silicon intermediates was only 48100 tons, and the industry inventory is continuously declining. The cycle has been compressed to within one week, driving confidence in the spot market. On the demand side, the combination of closed deals and limited orders triggered a "buying up" sentiment, and downstream customers actively inquired to replenish their inventory. There were secondary price increases in the trade process, and some sealant and silicone rubber factories planned to start stocking up at the end of the month ahead of schedule.
On the product side, the DMC quotation jumped from 10800-11200 yuan/ton before the accident to 12300-12800 yuan/ton, and the raw rubber also heated up synchronously, with an increase of 1000 yuan, both setting the highest daily record in the first half of the year. Derivative products such as 107 glue and silicone oil have risen by 500-800 yuan/ton, while other products are temporarily stable but have expectations of further increases, forming a price resonance across the entire industry chain. DMC: Yesterday saw a surge of over 9%, setting a record for the largest single day surge in the first half of the year. Most companies are still closed and not reporting, and the market is mainly dominated by bidding transactions. It is expected that DMC still has room for inertia to rise by 300-500 yuan/ton. Raw rubber: The increase is also over a thousand yuan, and the quotation has reached 13000-13500 yuan/ton. Last week, some rubber mixing factories have completed a wave of stocking, with sufficient inventory. Currently, the focus of transactions is still on essential needs, and by the end of the month, there may be a moderate increase to replenish inventory. 107 glue: The accident directly affected the supply of key products such as 107 glue, and the stocking demand of midstream and downstream enterprises was initiated in advance. Some silicone glue factories were forced to turn to other suppliers due to the delay of Dongyue orders, resulting in a surge in new orders. The current market trend is event driven upward, with continuous transmission of upstream costs and difficulty in quickly filling the downstream supply gap. Coupled with the fermentation of accident sentiment, this wave of upward trend will be maintained at least until the later part of this week. Local manufacturers are still concerned that future demand may not meet expectations. If the price increases too quickly, it may trigger resistance from the middle and lower reaches, leading to high priced transactions or gradual volume reduction.