Stable price signal or reappearance! Today's industry conference will set a clear tone for the silicone market: previously, a 40% production reduction plan was implemented from June to August, and a unified external quotation was issued in an attempt to consolidate the bottom price area. However, although the decision released a strong upward signal on the supply side, the actual market transactions did not follow suit - some individual factories had to secretly offer discounts to stimulate shipments due to poor acceptance of new orders and heavy inventory backlog, resulting in a significant gap between public quotations and actual negotiated prices. Yesterday, the actual transaction center of DMC further decreased to 12800-13000 yuan/ton. On the demand side, due to the traditional off-season of terminal consumption, the order volume of midstream and downstream enterprises has decreased, and coupled with a generally wait-and-see attitude towards future price trends, procurement behavior has become extremely cautious. Most companies only maintain a minimum turnover of raw materials and are unwilling to build large inventories; However, small and medium-sized enterprises with tight capital turnover even proactively reduce their operating rates to avoid price loss. Although there are many inquiries, few are actually implemented as purchases. The market lacks a basis for bulk transactions, and buying power has always been difficult to effectively drive prices. In the short term, the production reduction red line and unified price strategy determined at the meeting are more psychological support, and the actual supply and demand pattern has not yet fundamentally reversed. It is expected that the silicone market will continue to operate weakly and steadily.
Industrial silicon: On the supply side, under the influence of the wet season, new facilities have been added in the southwest region, and coupled with stable production by large factories in the north, the overall supply level is abundant. On the demand side, although polycrystalline silicon has resumed production, the purchasing power is limited, and the organic silicon monomer factory continues to adopt a load reduction mode to maintain the demand for industrial silicon. Overall, the gradual accumulation of supply and weak demand have led to a high risk of inventory accumulation in the industrial silicon market. With the deepening of the supply-demand contradiction, the current industrial silicon market price continues to fluctuate narrowly. As of July 2, the closing price of the main futures contract Si2609 is 8330 yuan/ton; The quotation for 421 # metal silicon is 9400-9750 yuan/ton.
Precipitation white carbon black market: On the raw material side, sulfur prices continue to remain at historical highs but show a slight decline in the short term; The sulfuric acid market maintains a high level of operation supported by supply contraction; In terms of soda ash, the contradiction between strong supply and weak demand is prominent, continuing to fluctuate at a low level. The overall cost is still relatively strong, which provides some support for the price of precipitated white carbon black. On the demand side, in the off-season of terminal consumption, downstream procurement is mainly driven by essential needs, with limited new inquiries and a lack of obvious positive market drivers. At present, the quotation for precipitated white carbon black used in silicone rubber has been partially lowered, with the mainstream price range of 6600-7500 yuan/ton. It is expected that the short-term precipitation of white carbon black market will continue its weak and stable consolidation trend, and the possibility of significant price fluctuations is low.
Gas phase white carbon black market: Currently, the spot circulation of raw material A continues to tighten. If individual factories further reduce emissions and raw materials remain tight, it will build a solid cost defense line for gas silicon. On the demand side, although the traditional silicone rubber field still mainly relies on on-demand replenishment and has not seen large-scale volume increase, the clear guidance of the new national standard on segmented varieties such as "sulfur free" liquid rubber and gas-phase rubber has significantly increased the purchasing willingness of related enterprises, and the substantial demand has shown a moderate expansion trend. Overall, the resonance between high cost enterprises and demand increment supports the price of silicon gas. Currently, there is not much inventory pressure on enterprises, and the high-end quotation for 200 specific surface area is firm at 25000-32000 yuan/ton, while the low-end quotation is 20000-22000 yuan/ton. In the future, it will take some time for terminal consumption to fully recover, and the upward space may still be constrained by the traditional consumption capacity. It is expected that the overall trend will be mainly stable, moderate, and strong.
Overall, the expected boost from industry joint production cuts and the reality of weak terminal orders will continue to hedge, and market sentiment will take time to recover. Whether future prices can stabilize or even rebound depends on two aspects: first, whether production cuts can be strictly implemented in terms of physical production capacity, rather than staying on paper; Secondly, after downstream inventory consumption reaches a low level, will they concentrate on entering the market for replenishment due to price hitting a psychological threshold. In short, the trend direction still needs to wait for clearer supply and demand signals to break the balance.