At present, the organic silicon market continues to operate at a high level, and the supply and demand pattern continues to improve. On the supply side, individual factories continuously alleviate supply pressure by actively reducing load and regulating supply. Yesterday, local quotations in East China were once again raised by 200 yuan/ton, with DMC quoted at 15000 yuan/ton and D4 quoted at 15300 yuan/ton. The market has strong confidence in maintaining prices.
On the demand side, although terminal and downstream demand have not yet experienced explosive growth, the willingness to replenish positions has increased under the tight spot market atmosphere, and the bullish mentality of downstream enterprises has gradually become a consensus. In addition, the supply of gas-phase white carbon black is tight, and limited orders are common. Yesterday, some companies quoted an additional 500 yuan/ton, and the price of 200 yuan/ton of gas-phase white carbon black increased to 20000 yuan/ton. The continuous rise of silicon dioxide further exacerbates the production costs of silicone adhesive, gas-phase adhesive, liquid adhesive and other products, and the trend of rising is also inevitable. Due to some manufacturers stocking up in advance, the increase has been differentiated, but overall it shows an upward trend.
At present, under the joint action of supply and demand, the organic silicon market is prone to rise but difficult to fall in April. With the market sentiment shifting from cautious to optimistic in the early stage, and the demand for replenishment in the middle and late stages being released again, and large investors gradually entering the market with locked orders, the DMC price is expected to continue to rise under the follow-up of high priced transactions.
Industrial silicon: On the supply side, due to the high electricity price cost constraints during the dry season, silicon plants in the southwest region have maintained a production reduction mode, while large factories in Xinjiang have expected to resume production, but have not clearly implemented it. Currently, the overall high supply is still difficult to alleviate. On the demand side, the price of polycrystalline silicon continues to fall, while organic silicon maintains emission reduction, and production is average.
At present, the supply-demand contradiction in the industrial silicon market is still prominent, which restricts the upward space of prices. However, the recent decline in polycrystalline silicon has hit the cost line, and there is a strong oversold rebound and technical repair demand in the market. Yesterday, the daily limit up ignited market sentiment, driving the industrial silicon market to heat up. As of April 13th, the closing price of the main futures contract Si2605 was 8415 yuan/ton, a rebound of 200 yuan; The spot price for 421 # metal silicon is 9300-10000 yuan/ton, with some prices dropping by 100 yuan. It is expected that industrial silicon will continue to operate weakly in the short term.
In terms of operating rate: Recently, some individual factories have entered routine maintenance, and the overall operating rate has declined. However, based on full pre-sale orders, most individual factories have stable production, and it is expected that the overall operating rate will remain around 65% within the month, with limited fluctuations.
On the demand side: Currently, the driving force of terminal demand continues to strengthen, and downstream fields such as high-temperature adhesives and room temperature adhesives are gradually recovering. The market's digestion pace of the previous cost increase has significantly accelerated. At the same time, the upstream supply is tight and the delivery cycle has been extended, further supporting market prices. In this situation, middle and downstream enterprises are maintaining essential procurement while actively delivering outstanding orders in the early stage. Industry profits continue to recover, and the market order volume steadily increases. However, in the short term, some enterprises have experienced a decline in export orders due to the cancellation of tax refunds; But geopolitical conflicts are still ongoing, and under the energy crisis, overseas companies' production is restricted, and some orders may be forced to flow back to China. As for the current downstream order situation, it is still relatively optimistic. According to our understanding at the Organic Silicon Mall, some high-temperature adhesive companies' pre-sale orders have been scheduled until mid May.
Overall, although the external environment remains severe, cost and domestic demand support are still strong, and supply and demand are tightly balanced. The middle and lower reaches are gradually accepting high priced raw materials, and the market's positive expectations will be further consolidated.