Shenzhen Planning and Natural Resources Bureau News: Shenzhen Zhuhe Technology, a subsidiary of Tuozhu Technology, won an 83600 square meter industrial land in Guangming District for RMB 141.2 million. The project plans to establish a "3D Printing Intelligent Manufacturing Headquarters Base" with a construction area of 376200 square meters and a planned annual production capacity of over 3 million 3D printers. Tuozhu Technology's consumer grade 3D printing equipment has ranked first in global sales for three consecutive years, with revenue exceeding 10 billion yuan in 2025.
Thursday (July 2nd) Organic Silicon Market Observation: Cost Collapse and Weak Demand Intertwine, 107 Adhesive Market Weakly Seeks Bottom
Entering Thursday, the domestic silicone market continued to operate under pressure, with a strong wait-and-see sentiment in the market, and buyers and sellers remained in a stalemate game. In just a few days, the transaction price has fallen sharply, and the collapse of upstream raw materials has caused severe fluctuations in the industrial chain. Monitoring data shows that methanol has dropped by as much as 30%, and DMC has also dropped by 2000 yuan/ton. The current DMC transaction price has fallen to the range of 13000-13100 yuan/ton. The logic of cost support collapsed instantly, and market sentiment became more cautious. However, after a deep drop in prices, multiple individual factories reported an increase in orders yesterday, and the stimulating effect of low prices on essential demand is slowly emerging.
From the perspective of supply and demand structure and circulation links, the current market presents typical characteristics of "high inventory and low elasticity". The process of reducing social inventory is slow, and the explicit inventory in the circulation link remains at a medium high level. Holders of goods are constrained by mid year capital withdrawal assessments and storage cost pressures, and their willingness to sell at a discount continues to increase. The focus of actual order negotiations continues to shift downwards, and the trend of weak basis is evident.
However, there is significant resistance to price transmission downstream, mainly due to insufficient elasticity of terminal demand. From the perspective of downstream structure, the demand for 107 adhesive in the field of building silicone sealant accounts for 42%, which is the most concentrated downstream direction of application; In addition, the proportion of applications in fields such as electronics and electrical engineering, photovoltaic new energy, and industrial adhesives is gradually increasing. However, the current construction sector is affected by the slowdown in the real estate cycle and infrastructure pace, resulting in a significant delay in demand release; The electronics and industrial manufacturing sectors are also dragged down by the slow recovery of terminal consumption, with limited order growth.
The operating load of downstream enterprises remains at a medium low level, the inventory turnover cycle of finished products is prolonged, and the profit margin continues to be compressed, resulting in the purchasing side only maintaining the follow-up of small orders for essential needs, and the stocking cycle is significantly shortened. Some downstream enterprises are still waiting for lower prices to enter the market at an appropriate time. From the perspective of marginal demand, although there have been instances of buying stocks at low prices in certain regions, the volume is limited and effective demand resonance has not been formed. The supply-demand mismatch pattern has not yet shown substantial improvement. In terms of the overall operating rate of the industry, the load of individual plant equipment has generally decreased recently, and the operating rate has dropped to around 60%. However, the contraction of supply is still not as strong as the contraction of demand, and the market is still in a weak equilibrium stage of oversupply. The trading activity needs to be triggered by external variables.
Focusing on the 107 glue market, the current trading atmosphere is also in a stalemate. Downstream buyers have a weak willingness to accept high-level sources of goods, and various production enterprises are under pressure to ship, resulting in a slight downward trend in the market. As of July 1st, the mainstream price of 107 glue has remained at 14000-14800 yuan/ton, while the actual transaction price of large investors has significantly decreased, falling to 13500-14000 yuan/ton. The narrowing of the price difference between high and low positions reflects that the bargaining power of sellers is being weakened. From a cost perspective, although the price of DMC raw materials has dropped significantly, the production cost pressure of 107 rubber enterprises is still prominent - this is mainly due to the inversion between the amortization of high priced raw material inventory in the early stage and the current product price, which has led to a slow decline in industry operating rates. Some 107 rubber plants in central China have already controlled their load operation. The increment of newly signed orders on the demand side is insufficient, and overall production remains in the mid to low range. The high price continues to suppress downstream demand for goods. Terminal silicone rubber factories mainly replenish inventory in small batches according to demand, and the industry is generally observing the pace of subsequent demand recovery, with few large-scale stocking actions.
The industry generally believes that the current market is still maintaining a stagnant consolidation pattern. The quotations from each individual factory are gradually being released, and the balance price changes are relatively limited. However, the actual transactions have shifted to individual negotiations, and the bargaining space is relatively flexible. The boosting of grassroots demand at the terminal level is weak, and on-site transactions are flat. Large investors are mostly observing manufacturers' subsequent preferential policies and only making small payments as needed, resulting in low enthusiasm for large-scale market entry operations.
It is worth noting that today's industry conference is about to be held, and whether all parties in the market can reach a consensus on collaborative production reduction, price increase, or adjustment of sales strategies will become a key variable determining whether the supply-demand pattern can see substantial improvement. From recent trends, multiple individual factories have started equipment shutdown and maintenance at the end of June, and the operating rate is expected to drop below 60% in early July. The expectation of supply side contraction is accelerating. Short term prediction shows that the price of organic silicon is likely to continue its weak consolidation pattern, and there is still a high possibility of a slight decline. The 107 adhesive market is also stable and weak, and prices may continue to loosen slightly. It is recommended that business owners closely monitor the final resolution of today's meeting and the pricing trends of major factories to grasp the subsequent operational window.