A rebound across the board! Driven by macroeconomic policies and the upward trend in the market, industrial silicon futures rose again yesterday. As of September 16th, the main contract 2511 closed at 8915 yuan, an increase of 505 yuan from 8410 yuan last Tuesday! This week has also driven the spot market: the price of 421 # metal silicon has collectively risen by around 100-200 yuan, with a price range of 9700-10400 yuan/ton. For individual factories, the cost has further increased, and the operational space has narrowed again. At present, downstream procurement maintains a small amount of procurement for essential needs, which provides moderate support for the upstream market. Some individual factories with high inventory have certain shipping pressure. However, under the pressure of cost and loss, individual factories have a low willingness to offer discounts, and there have been unexpected accidents in the past two days. It is expected that the overall operating rate will continue to remain stable, and the industry's expectation of an increase in operating rate in late September has decreased. Some individual factories have increased confidence in stabilizing prices. Looking at it now, most individual factories' pre-sale orders are mostly scheduled until the end of the month. In the past two weeks, new orders have been sluggish, and downstream enterprises have remained calm about unexpected accidents, continuing to purchase on demand without impulsive stocking. Therefore, the pressure on some individual factories to ship has begun to heat up. In order to achieve the expected inventory reduction before the National Day holiday, the market is likely to experience a phenomenon of "price for quantity" in the future.
Raw rubber market: Currently, the mainstream quotation for raw rubber continues at 12000-12200 yuan/ton. On the supply side, the main large factories have a relatively strong load, and the production of raw rubber equipment is also relatively high. However, with the support of previous orders, coupled with downstream follow-up orders, further easing the production capacity of raw rubber, the inventory pressure is controllable in the short term. On the demand side: As the end of the month approaches, some rubber mixing enterprises that did not have sufficient stock in the early stage are gradually laying out at low prices. However, in the situation of losses, most rubber mixing enterprises are maintaining short-term and moderate inventory replenishment, and mostly concentrate on placing orders with leading rubber factories to maintain long-term preferential policies. Other rubber factories offer discounts on core customer orders to maintain market share and ensure the continuity of new orders. Overall, the enthusiasm of rubber mixing enterprises for stocking up is average, with a strong wait-and-see attitude in the market and average acceptance of orders for raw rubber. It is expected that the raw rubber market prices will continue to operate steadily this week, and subsequent trading will depend on changes in cost prices and downstream stocking conditions.
Rubber mixing market: This week, the price of rubber mixing continues to be 11500-12000 yuan/ton. However, due to demand constraints, transactions continue to be negotiated on a case by case basis. Specifically, based on the current weak economic environment, even though the production capacity of rubber compounds has been weakened due to the long-term reshuffle pattern, rubber compounds still cannot escape the situation of low price competition in the face of sluggish terminal demand, and may even face a bidding situation of three to one in transactions. Moreover, downstream silicon product companies lack confidence in the future market, and under the influence of negative factors such as e-commerce taxes and cross-border e-commerce, the profits of silicon product factories continue to be squeezed, especially for those mainly based on processing orders, which have almost no bargaining power over customers. Therefore, they can only constantly pressure raw materials to compare prices, leading to an increasingly fierce competitive atmosphere for mixing rubber enterprises.
In addition, in order to alleviate the current business difficulties, medium and large rubber mixing enterprises are reducing the burden of ordinary rubber in an orderly manner, actively improving customized silicone rubber business, and partially deepening and expanding the liquid rubber track, in order to optimize product structure, and most importantly, continuously tightening payment collection. It is expected that the mixed rubber market will continue to operate weakly and steadily in the short term.