In May, the real estate market showed an unexpected recovery trend, with new housing prices in first tier cities rising by 0.2% month on month, marking four consecutive months of positive growth; Second hand housing prices have increased by 0.4% month on month, marking three consecutive months of growth. Prices for second-hand housing in Beijing, Shanghai, Guangzhou, and Shenzhen have all increased month on month. Industry insiders believe that the momentum of housing prices turning from decline to rise has increased, and the signal of market stabilization has been released. At the policy level, the release of the "15th Five Year Plan for Urban Renewal" and the implementation of new housing provident fund policies continue to make efforts, and the leading role of first tier cities is significant, which is expected to drive the bottoming out and stabilization of the national market.
Rising 100%! Another 'new material' has doubled in price! Iron phosphate and lithium iron phosphate are important raw materials for new energy and energy storage batteries. Since the beginning of this year, prices have been rising and the market heat remains high. CCTV Finance News: Lithium iron phosphate is an important material for making new energy vehicle batteries. A pack of about 400 kilograms of lithium iron phosphate now costs over 25000 yuan. And a year ago, its price was only 10000 yuan, and in just one year, the price has more than doubled.
Despite the doubling of prices, demand remains strong. In the finished product warehouse of a lithium iron phosphate production factory in Mabian Yi Autonomous County, Sichuan Province, both the newly added shelves and the ground are filled with goods. Forklifts are constantly busy going in and out, and due to downstream customers' concentrated reminders, the product delivery cycle has been shortened from 10 days to 7 days.
The sales manager of the enterprise introduced that the order volume has increased by more than 30% year-on-year, and is increasing every month, with the highest being in May, with about 4300 tons. More than 2700 tons have been delivered in June, and it is expected to reach 4500 tons.
Entering late June, the overall organic silicon market continued its weak pattern during the off-season. On the supply side, the inventory of individual factories in multiple regions continues to accumulate, and there is sufficient supply of high priced goods circulating in the market. Small and medium-sized traders have a strong desire to reduce inventory; On the demand side, downstream industries such as aerospace, electronics and electrical, construction, transportation, chemical, textile, food, light industry, medical, etc. generally have low operating rates and lack enthusiasm for raw material procurement. They tend to replenish goods in small quantities according to demand and resist high priced sources of goods. In this context, there has been a certain differentiation in the trends of the raw rubber and mixed rubber markets - the raw rubber market has maintained consolidation under the support of cost bottoming and the willingness to raise prices, while the mixed rubber market has been further disrupted by local low prices.
Raw rubber market: coexistence of rising prices and declining prices, with a relatively weak trading atmosphere
As of June 23rd, the mainstream offer for raw rubber remained at 15500-15800 yuan/ton. Raw rubber production enterprises in Zhejiang, Shandong, Hubei, Inner Mongolia, Yunnan and other places have a strong willingness to raise prices, and their quotations adhere to the above range. However, the market trading atmosphere is weak, and mainstream quotations remain organized and operated.
From the supply side, the three major leading factories continue to implement the "volume for price" strategy, with transaction prices concentrated between 15000-15500 yuan/ton, and core large-scale transactions mostly being negotiated on a single basis. At the same time, the 40% collaborative emission reduction plan for the industry from June to August is being promoted, and multiple individual enterprises are gradually shutting down to reduce their burdens, causing the industry's operating rate to fall back to around 65%. Maintenance and restart coexist, and the supply is shrinking in stages.
From a cost perspective, the mainstream offer for DMC raw materials is 14700-15100 yuan/ton, with slight fluctuations and a decline in the market, but still providing a certain cost support for raw rubber. However, there is ample supply of high priced goods in the market, and downstream terminal demand continues to be sluggish. Spot holders are under pressure to ship, and they often compete for orders by offering discounts and bidding to buy goods. The focus of market competition has shifted from "price manipulation" to "concession", and the "price for volume" strategy is continuously disrupting the direction of price manipulation.
The mixed rubber market: local "bleeding" agitation, pressure on the price system
In terms of the mixed rubber market, new changes are particularly noteworthy. Some individual enterprises in the Jiangsu and Zhejiang regions continue to "bleed" and compete for orders, smashing the market with low-priced goods and stirring up the originally stable market, which has had a certain impact on the overall price system of the mixed rubber market and triggered local price competition.
At present, the mainstream price for conventional hardness mixed rubber is 14.0-14.7 yuan/KG. The overall stable price operation of the South China mixed rubber spot market has resulted in a flat and orderly trading performance on site. Production enterprises have a strong willingness to raise prices, and the operation of equipment remains normal; Downstream silicon product factories purchase on a regular basis according to demand, with stable supply and demand in both directions, and there is currently no adjustment in market quotations.
However, it is worth noting that the rubber mixing industry has fallen into a vicious cycle of "one order, no profit", with fierce homogenization competition. The intense competition in the terminal silicon products market has led to significant fluctuations in revenue and net profit for rubber mixing enterprises. Some manufacturers have stated that although the current market shipment base is high, profitability is extremely difficult. Under the tug of war between cost support and weak demand, the trend of differentiation in the silicone industry chain is becoming increasingly evident.
Overall, the current silicone market is in a supply-demand stalemate. The supply side is experiencing a phased contraction due to the 40% coordinated emission reduction policy, but the demand side is in the traditional off-season. The shipment of end products continues to be weak, and the inventory of finished products in the middle and lower reaches is high. The raw material destocking cycle is prolonged, and only small orders for essential needs are maintained, resulting in a strong wait-and-see attitude towards price reduction. There are few new orders signed on the market, and overall transactions are quiet.
In the short term, the market maintains a cautious wait-and-see attitude, and prices may continue to operate weakly and steadily, with slight fluctuations and a downward trend. In terms of raw rubber, with the promotion of production reduction and cost support, the downward exploration space is relatively limited, but the upward trend also lacks demand drive; In terms of rubber mixing, local low price competition is difficult to eliminate in the short term, but mainstream enterprises still have the willingness to raise prices, and it is expected that the market will continue to maintain a stable and differentiated consolidation trend.
The key variables for the later trend are: first, whether the actual implementation of the production reduction strategy can effectively shrink supply; The second is whether there will be a phased release of replenishment demand after the downstream inventory reaches its bottom. It is recommended that the industry closely monitor the pricing strategies of leading manufacturers and changes in downstream orders, carefully schedule production, and respond flexibly.