On September 22nd, it was reported that since the implementation of the 14th Five Year Plan, China has achieved leapfrog development in multiple strategic emerging industries. As of now, about 4.6 million 5G base stations have been built, and the scale of information infrastructure is leading globally; The photovoltaic and wind power industries maintain strong momentum, with newly installed capacity exceeding 100 million kilowatts for four consecutive years, and the green energy structure continues to optimize. The performance of the new energy vehicle market is particularly outstanding, with cumulative sales exceeding 40 million units nationwide and production and sales ranking first in the world for ten consecutive years.
In this context, the demand for downstream products of organosilicon has seen significant growth. The heads of several leading silicone brand companies have stated that it is expected that the overall solution demand from new energy vehicles, electronic appliances, communication equipment, rail transit, solar photovoltaics, organic refractory materials, aviation and military industries will increase by 15% to 20% year-on-year this year.
With the increasing requirements for lightweight and safety of new energy vehicles, high-performance silicone rubber, thermal conductive silicone grease, etc. are widely used in battery packaging, sealing systems, and thermal management; The demand for silicon gel, liquid silica gel and other packaging and insulation materials in the electronic and electrical field continues to rise; 5G communication equipment has driven the use of high-frequency and high-speed silicon-based electronic chemicals; The photovoltaic industry continues to rely on key materials such as silicone adhesive and encapsulation film. In addition, special organic silicon materials have become indispensable functional materials in fields such as rail transit, fire-resistant building materials, aerospace, and military industry due to their excellent characteristics of high and low temperature resistance, flame retardancy, and insulation.
The downstream industry of organosilicon is relying on the rapid development of national strategic emerging industries, continuously expanding high-end application scenarios, and promoting the transformation and upgrading of product structure towards high added value and multifunctionality.
It's rising again! Last week, the domestic silicone market continued to show a strong trend, driven by macroeconomic sentiment and sudden maintenance events. Mainstream monomer factories have a strong collective willingness to raise prices, and DMC prices have achieved a temporary rebound. Specifically, the DMC quotation has been raised by 200-300 yuan/ton, to 10900-12300 yuan/ton. The mainstream transaction price has re entered the key support level of 11000 yuan/ton, but the rebound is still slightly lower than market expectations. As the weekend approached, a sudden flash fire incident occurred at a major single plant, causing the entire line to shut down. Market sentiment quickly tightened, and supply expectations significantly tightened. Affected by this, the DMC spot market has slightly increased, and the trading atmosphere has rebounded.
From the perspective of supply and demand structure, some devices were still under maintenance during the week, and the industry's operating load slightly decreased, leading to a slight easing of supply side pressure. Domestic demand procurement has slightly rebounded, but export orders remain weak. Due to price competition in Southeast Asia, overall exports are mainly on a wait-and-see basis. Therefore, although prices have rebounded, industry inventories are still accumulating, and the supply-demand game in the spot market continues.
It is worth noting that despite being in the traditional "Golden September" peak season, the organic silicon market did not experience the expected strong rise, but instead continued to fall into the market paradox of "weak peak season and rebound in off-season". This abnormal rhythm has been going on for many years, not only disrupting the stocking cycle of downstream silicone rubber, silicone products and other enterprises, but also reflecting the deep contradiction that the industry is facing between capacity expansion and demand growth mismatch.
In the short term, as the National Day holiday approaches, some downstream companies still have the intention of stocking up for pre holiday needs, and major manufacturers are actively carrying out pre-sale operations, with prices maintaining range fluctuations. But for the future market, there is a divergence in market views: bears believe that high inventory and weak exports have not fundamentally improved, and the upward space for prices is limited; However, the majority of viewers are concerned about the short-term supply shock and increased cost support brought about by sudden production shutdowns.
Overall, the current organic silicon market is still in a game stage of "strong expectations and weak reality". Under the dual influence of macro sentiment and fundamentals, it is expected that the prices of organic silicon such as DMC will continue to fluctuate within a certain range.