Entering the middle of the week, the silicone market has gradually entered the post rise digestion stage after experiencing a price increase across the board last week. From the perspective of the market, although domestic and foreign consumption drivers are still insufficient and terminal demand follow-up is relatively slow, after a round of buying and stocking up, the stocking pace of middle and downstream enterprises continues to be gradual, providing price support for upstream individual factories. Currently, the mainstream DMC quotation is firm at 13500-14000 yuan/ton, and the main contradiction between supply and demand has shifted from supply-demand imbalance to price consolidation and profit repair. As individual factories continue to reduce emissions, the middle and lower reaches will follow suit in an orderly manner, and new orders will transform positively. The second round of gains is expected to be digested by the market in mid to late December.
Overall, upstream and downstream enterprises are collaborating to promote profit recovery, and the market is showing an overall trend of maintaining stability and stabilizing prices. It is expected that under the influence of the "anti internal competition" and self-discipline mechanism, the end month of 2025 will steadily embark on the path of collaborative repair.
Industrial Silicon: Due to the impact of the dry season, production in the southwest region has remained low, while the number of silicon plants operating in the northern region has not changed much. However, there were environmental restrictions in Xinjiang last weekend, and there may be expectations of a decrease in production in the future. Overall production capacity continues to shrink. On the demand side, the production of polycrystalline silicon is not high, and the sluggish transaction volume exacerbates the bearish sentiment in the market; In terms of organosilicon, the high prices of monomer factories have improved, but orders still revolve around essential needs, and the demand for industrial silicon is still limited.
Overall, despite the recent tightening of supply, the oversupply situation in the industrial silicon market has not changed under the previous surplus situation. Currently, spot prices have fallen slightly. As of December 8th, the closing price of the main futures contract Si2601 was 8675 yuan/ton, a decrease of 175 yuan; The price of 421 # metal silicon in stock is 9700-10200 yuan/ton, with a partial decrease of 100 yuan. In the future, under the situation of weak supply and demand, the industrial silicon market is unlikely to have upward support, and it is expected that the market will continue to operate with weak fluctuations.
In terms of operating rate: This week, some individual factories will continue to carry out rotating maintenance to achieve emission reduction targets, with operating rates between 68% and 70%, further consolidating the confidence of the middle and lower reaches in the future market. With the support of pre-sale orders and profit improvement, individual factories have a strong driving force for emission reduction.