By 2025, it is estimated that up to 40% of luxury goods will be sold at discounted prices, which will hit the industry's profits. After years of price increases, consumers have begun to question the value of designer products. In the downturn of the market for designer products ranging from shoes to handbags, the rising discount has lowered the industry's profit margin to the lowest point in 15 years (excluding the period of COVID-19 epidemic). According to data from consulting firm Bain and Italian luxury goods industry association Altagamma, approximately 35% to 40% of luxury goods were sold at discounted prices last year, at least 5 percentage points higher than a decade ago.
Unexpectedly, yesterday, the organic silicon sector experienced a rare general rise, and the stock prices of major production companies collectively rebounded strongly. As of the close, several leading companies have seen significant gains: Dongyue has risen by 9.38% (up more than 15% at one point), Xingfa has risen by 8.89%, Luxi has risen by 7.63%, Sanyou has risen by 6.5%, Xin'an has risen by 6.29%, Hesheng has risen by 4.97%, Xingxing has risen by 2.29%, and Yuntou has risen by 2.16%. Two major factors have driven this: 1) industry consensus has been reached to end "internal competition": market analysis points out that this round of stock price rebound is not accidental. The long-standing "price war" and overcapacity issues in the silicone industry are undergoing fundamental changes. It is reported that major manufacturers have reached a consensus and are actively adjusting their business strategies. 2) The effectiveness of reducing production and maintaining prices has begun to show: Industry experts say, "This marks the awakening of the industry. Major factories are abandoning the previous fierce internal competition model and shifting towards more rational coordinated development." The production reduction and price protection strategy implemented by leading enterprises has begun to produce positive results, improving market supply and demand relations and stabilizing and recovering product prices.
Analysts believe that this collective rebound sends a clear signal that the silicone industry may be emerging from the low price competition dilemma and entering a new stage of development. With the strengthening of industry self-discipline and optimization of production capacity structure, the profitability of leading enterprises is expected to continue to improve.
Up, up, up! According to reliable market news, the industry price adjustment this Friday is expected to mainly focus on DMC and raw rubber, with a magnitude of about 300 yuan per ton. News from Silicon Cloud Online: After the New Year holiday, the overall organic silicon market remained stable, with some areas stabilizing and exploring gains. Mainstream product prices remain high and stable, and the industry's supply and demand pattern presents a structured feature. The cost side support continues to solidify. As of January 5th, the price of 421 # industrial silicon for organosilicon is 9800-10200 yuan/ton, and the supply of raw materials is relatively stable, further consolidating its cost support role. The contraction trend of the supply side is clear. The overall operating rate of the industry remains around 65%. Multiple individual factories in East and North China have reduced their load operation, while facilities in Sichuan have been shut down for maintenance during the dry season, maintaining a tight supply-demand balance in the market. Maintain resilience in the demand side of the new energy sector; The construction industry is affected by the winter construction off-season, which limits outdoor operations for northern enterprises and slightly reduces demand; Short term weak demand in the photovoltaic field; The overall operating rate of downstream enterprises is still at a low level during the off-season; Procurement is mainly based on essential needs, and some enterprises have started moderate stocking before the holiday, resulting in an increased acceptance of high prices compared to the previous period. The market inventory of core organic silicon products on the inventory side is at a relatively low level this year, and some enterprises are operating with "zero inventory" due to sufficient pre-sale orders, resulting in closed and restricted sales. The market has a strong willingness to raise prices.
DMC remained relatively stable this week, with some areas showing a willingness to explore price increases. As of January 6th, the mainstream quotation for DMC is around 14000 yuan/ton. Supply contraction continues, and some companies are closing down and restricting sales. The willingness of downstream enterprises to replenish their inventory has increased, and the demand in the new energy sector remains resilient, effectively offsetting the short-term weakness in the photovoltaic sector. The market has a solid foundation for price support.
107 glue has been running smoothly this week. As of January 6th, the mainstream quotation for 107 glue is 14200-14500 yuan/ton. Supported by stable upstream DMC raw material prices and low inventory levels, the company has a clear willingness to raise prices. The demand side shows structural differentiation, with stable demand in the fields of new energy and electronics, and slightly weaker demand in the construction industry due to the winter construction off-season. Downstream procurement is mainly based on essential needs, and some enterprises have started moderate stocking before the holiday.
Silicone oil maintained a stable to slightly strong trend this week. As of January 6th, the mainstream quotation for domestically produced methyl silicone oil is 15200-15800 yuan/ton. The demand side shows differentiated performance, with stable demand in the new energy, textile, and daily chemical fields, temporary weak demand in the photovoltaic field, moderate release of terminal orders, and steady progress in high priced source transactions. The overall inventory of the industry is currently in a low range, and spot prices remain firm.
As of January 6th, the mainstream price of raw rubber is 14500-15000 yuan/ton. Due to the high cost of upstream raw materials and the reduction of equipment load and production, the bottom support of the price is strong. The demand for downstream areas such as automotive parts remains stable, and the year-end stock of essential goods supports stable orders, resulting in a relatively tight supply of goods in the market.
Overall, the organic silicon market will continue to operate in a "stable to strong" trend, with a slower upward pace and entering a "high-level oscillation digestion stage". As the end of the year approaches, the stocking demand of midstream and downstream enterprises is gradually released, coupled with the continuous contraction trend of the supply side, the market price will still receive strong support in the short term.