On Monday of this week, the domestic organic silicon market continued its strong upward trend, showing the following main characteristics:
1、 DMC market: prices have risen significantly, and there is a strong wait-and-see sentiment in the market
Market trend: The mainstream quotation of DMC has broken through the 13000 yuan/ton mark across the board, concentrated between 13000-13500 yuan/ton. Since early November, the cumulative increase has exceeded 2000 yuan/ton, setting a record for the largest band increase of the year, and the upward trend has continued for multiple trading days.
Supply side analysis: Most individual production enterprises adopt the strategy of "closing deals and not reporting", waiting for the guidance of today's key industry conference. This behavior has intensified the market's spot tension and is the core factor driving price increases. Although the official quotation of a certain benchmark enterprise in Shandong remains stable, there is actually room for concessions to core customers, indicating that there is a certain degree of differentiation behind the current market strength.
Demand side analysis: Downstream enterprises generally have a low acceptance of high priced raw materials, and their procurement behavior is mainly based on rigid needs, with weak willingness to hoard goods on a large scale. This has led to an overall rebound in the market's inquiry and transaction atmosphere, but there has not been a corresponding increase in volume that matches the price increase.
2、 Raw rubber market: prominent supply-demand contradiction, with a more rapid upward trend
Market trend: The performance of the raw rubber market is particularly strong, with major factories such as Xingfa, Hesheng, Dongyue, Hengxing, Xin'an, and Hengyecheng all closing down. The spot price in the market has jumped sharply to around 13500 yuan/ton, leading the increase in DMC.
Deep root cause analysis: The explosive rise of raw rubber in this round is fundamentally due to the complete reversal of supply and demand fundamentals.
Highly concentrated supply: After years of reshuffling, the industry has a highly concentrated production capacity, with about 80% of the output controlled by the top three enterprises, which significantly enhances the synergy and bargaining power of the supply side.
Continuous clearance of production capacity: During the long period of low prices in the early stage, the industry fell into widespread losses, leading to the permanent withdrawal of a large number of small and medium-sized production capacities, and the overall market supply capacity has significantly contracted.
Demand hit a bottleneck: When downstream demand (especially in the fields of new energy and consumer silicon products) rapidly recovers in the near future, the suddenly tense market supply-demand contradiction is quickly ignited, thereby driving up the price of raw rubber rapidly.
Market Summary and Outlook: Overall, the current rise in the silicone market is mainly driven by the supply side. Production enterprises create tight expectations by controlling quantity and sealing off inventory, while the rigid pattern of downstream demand poses a test of the sustainability of price increases. Today's industry conference will become a key short-term indicator, and if the conference releases positive signals, prices may continue to remain firm; If downstream resistance eventually spreads to upstream, the market may enter a high-level oscillation stage.