On Tuesday, driven by the escalation of geopolitical conflicts in the Middle East and concerns about transportation and supply caused by the closure of the Strait of Hormuz, international crude oil prices surged sharply, with US crude oil approaching $75 per barrel at one point, and domestic SC crude oil futures hitting the daily limit up. As a result, the spot market for chemical futures has generally risen. As of the close on March 2nd, 92% of the 50 major petrochemical products tracked have seen an increase, with butanone being the top rising variety, rising by 200-300 yuan/ton. Butanone is the core basic raw material for the production of methyl tributone oxime silane (crosslinking agent), and its price fluctuations have a direct impact on the production cost of crosslinking agents. With the significant increase in the price of butanone, multiple crosslinking agent manufacturers are facing cost transmission pressure, and market expectations have changed. Some crosslinking agent manufacturers have started to close their positions and wait for the situation to become clear before making a quotation. At the same time, the leading price of 107 silicone adhesive has risen to 15100 yuan/ton. Overall, the price of silicone adhesive has started to soar, and some silicone adhesive manufacturers have limited orders!
Entering Wednesday, the domestic organic silicon market as a whole continued its upward trend, with major product prices slightly rising and the industry's supply and demand pattern gradually improving. The overall market presents the characteristics of stable cost support, tight supply, and stable demand recovery, with a mild and positive trading atmosphere in various links of the industrial chain.
Cost side support is relatively stable: From the raw material side, the price of 421 # industrial silicon for organic silicon remains in the range of 9800-10200 yuan/ton, with little overall fluctuation. At the same time, the recent increase in methanol prices has facilitated smooth cost transmission, providing some support for the upward trend of organic silicon product prices. Overall, cost factors provide a fundamental guarantee for maintaining a stable and upward trend in current market prices.
Effective tightness on the supply side: On the supply side, the overall operating rate of the industry during the Spring Festival was at a relatively low level of 40-50%. After an orderly recovery one week after the holiday, the operating rate is steadily recovering, and the production pace of the industry is gradually returning to normal. However, from a structural perspective, there are still multiple tightening factors on the supply side: some individual factories in East China and North China are still operating in a reduced load state; Some devices in Sichuan are still in the maintenance stage; Due to the gradual implementation of industry coordinated emission reduction policies from March to May, the overall effective supply in the market is tight. At present, logistics and transportation remain smooth, and the production pace of enterprises is steadily advancing.
The demand side urgently needs support: The demand side is showing a trend of multi domain differentiation. In terms of traditional fields, industries such as textiles require stable operation; The terminal demand in the construction field is steadily recovering, providing support for related products. In terms of emerging fields, the demand resilience of the new energy sector is good, maintaining a steady growth trend; The demand in the electronic field remains rigid and has a certain supporting effect on the market. The photovoltaic sector is expected to be affected by the cancellation of export tax rebates in April, which has put pressure on short-term export orders. From the perspective of downstream procurement pace, the pace of essential procurement is stable, and the market's wait-and-see sentiment has weakened compared to the previous period.
The pace of inventory digestion is accelerating: In terms of inventory, the overall inventory of downstream industries is at a low level. The accumulated inventory during the Spring Festival period has gradually been digested, coupled with sufficient pre orders from some individual factories before the holiday. The current pace of inventory digestion is stable and accelerating. The healthy operation of inventory levels provides support for the continuation of the tight supply-demand balance pattern in the industry.