A representative from Bayer Group stated on Tuesday that despite facing numerous lawsuits over its glyphosate herbicide Roundup, Bayer currently has no plans to spin off Monsanto. The representative stated that although restructuring may be a feasible option, the company is focusing on improving performance and dealing with the current wave of litigation. In 2018, Bayer spent $63 billion to acquire Monsanto, including the herbicide "Nongda". Subsequently, consumers filed lawsuits claiming that Bayer failed to warn consumers that the active ingredients in "Nongda" may cause cancer.
The latest market information shows that the reshuffle in the silicone products industry is still ongoing. Recently, three silicone companies have encountered difficulties, namely Quanzhou XXX Silicone Mold Co., Ltd., Zhongshan XXX Silicone Rubber Products Co., Ltd., and Dongguan XXX Precision Silicone Technology Co., Ltd. Their basic situation is as follows:
Quanzhou XXX Silicone Mold Co., Ltd. was established on April 28, 2003, located in Heshi Town, Luojiang District, Quanzhou City. It mainly engages in the production of silicone, silicone rubber, mold silicone, hand pulled silicone and other silicone products. As an old enterprise that has been in operation for more than 20 years, the difficulties it faces reflect the structural contradictions accumulated in the industry.
Zhongshan XXX Silicone Rubber Products Co., Ltd. was established on February 10, 2021, located in Dongfeng Town, Zhongshan City, Guangdong Province. It mainly produces molded silicone rubber parts and processes various silicone rubber spare parts. This is a relatively young enterprise, established just over four years ago.
Dongguan XXX Precision Silicone Technology Co., Ltd. was established in July 2019 with a registered capital of 5 million yuan. It is located in Chang'an Town, Dongguan City, Guangdong Province, and mainly researches, designs, produces, and sells precision silicone products, rubber products, hardware products, molds, electronic products, and mobile phone parts.
In 2026, the silicone products industry is in a critical period of "quality improvement and value restructuring". On the one hand, the overcapacity caused by homogenization and the internal competition of low-quality prices have led to a large number of enterprises falling into difficulties or even bankruptcy, and industry reshuffling is inevitable; On the other hand, the upgrading of downstream applications such as new energy vehicles, healthcare, and consumer electronics has opened up new tracks for enterprises with technological advantages and compliance capabilities. The trend of transitioning from "standardized mass production" to "multi variety, small batch, customized" is becoming increasingly evident, and flexible production capacity and rapid response mechanism have become the core competitiveness of the silicone products industry. The industry will evolve towards high-end, green, and customized directions, and silicone product companies with accumulated technology, compliance systems, and precision manufacturing capabilities are expected to seize the opportunity in the reshuffle. Overall, the silicone products industry is bidding farewell to the stage of extensive growth and entering a new cycle of high-quality development. The pattern of survival of the fittest and constant strength of the strong will be further strengthened.
Entering Friday, the silicone market as a whole presented a pattern of "stable guidance prices and differentiated actual transactions", with continuous upstream and downstream game constraints on the upward price space, and a strong bearish sentiment in the market. As of that day, the mainstream offer price in the DMC market was in the range of 14800-15100 yuan/ton, with a weak trading atmosphere at high levels and only basic orders remaining in some areas. Downstream enterprises were mainly adopting a wait-and-see attitude, and the market was characterized by digestion and consolidation. The price of 107 rubber purified water remains synchronized at 14800-15000 yuan/ton, and the mainstream reference price of raw rubber is in the range of 15500-15800 yuan/ton, continuing the stable to weak pattern since last week. Although some individual factories attempt to convey confidence by stabilizing prices and supporting the market, weak terminal demand and weakened cost support form a dual suppression, and the focus of market competition is still on the dynamic balance between supply and demand.
From the supply side perspective, mainstream single unit plant equipment still focuses on load reduction operation. During the period, the weekly average capacity utilization rate of the monomer units of 11 domestic organic silicon DMC sample enterprises was about 70.62%. Mainstream individual factories plan to hold another industry conference in the near future to further clarify the implementation rules for the phased collaborative production reduction of 40% from June to August. If the supply-demand imbalance in the industry does not significantly improve, the production reduction ratio will be raised to 45%. In addition, some individual factories in North China and Southwest China have routine maintenance plans in the middle and late part of this month, and there is a strong expectation of overall contraction in the supply side. From the perspective of actual shipments, multiple individual factories, under the surface of stable quotations, have made slight concessions to accelerate inventory reduction. However, downstream procurement has only slightly rebounded, continuing the strategy of purchasing in small quantities according to demand, and the willingness to stockpile is still clearly insufficient.
In terms of cost, industrial silicon maintains a weak and stable trend in the short term, coupled with narrow fluctuations in methanol prices, resulting in weakened cost support compared to the previous period. Recently, the price of silicon metal has been at a low level, and silicon factories in the north and south have gradually entered a production cycle, which makes it difficult to effectively drive the cost of organic silicon.
At the level of enterprise dynamics, the news coverage of leading companies in the silicone industry has been relatively active this week. On June 3rd, the organic silicon concept sector experienced overall fluctuations and gains, with Dongyue Silicon Materials leading the way with a rise of over 10%. Stocks such as Silicon Treasure Technology, Chengguang New Materials, Huitian New Materials, and Hesheng Silicon Industry followed suit, with a net inflow of approximately 55.9 million yuan in main funds on the same day. It is worth noting that Hesheng Silicon Industry has fully mass-produced 6/8-inch silicon carbide substrates. The high value-added track is the driving force for the growth of organic silicon enterprises. The demand growth rate for organic silicon deep processing products in emerging fields such as new energy vehicles (adhesive/sealing for power batteries), AI computing power (submerged coolant), photovoltaics (module sealing/backplate materials), and humanoid robots (skin/flexible sensing) is much higher than that in traditional construction/textile fields.
In the short term, the organic silicon market will still be in a two-way game of supply support and weak demand. Upstream production cuts are expected to provide bottom support for prices, but China has entered a traditional off-season, and terminal demand is unlikely to substantially recover. Downstream procurement will adhere to a small order strategy. Against the backdrop of weakened cost support and unchanged downstream wait-and-see sentiment, it is expected that the silicone market will continue to operate in a stable to weak trend in the short term.