Entering Wednesday, the organic silicon market is still in a dilemma of reducing production and raising prices while being constrained by demand, maintaining an overall weak balance pattern. From the on-site perspective, individual factories are implementing the established production reduction plan, and subsequent maintenance may further tighten the circulation of spot goods. At the same time, with the buffer support of low-priced and high-volume orders in the early stage, the attitude of individual factories towards quotation is relatively firm, and the actual negotiation focus has been raised compared to the early stage. Currently, the DMC transaction price has rebounded to 13900-14000 yuan/ton.
On the demand side, terminal consumption is still in the traditional off-season, with slow inventory digestion and limited profit margins for midstream and downstream enterprises, directly suppressing the willingness to purchase raw materials. Even if prices stabilize, downstream only maintains a small amount of essential purchases, lacking the motivation for centralized stocking.
Overall, the current weak supply-demand pattern balances each other, and the market lacks breakthrough driving factors. Short term price increases are constrained by weak consumption, while declines are supported by production cuts, and are likely to fluctuate narrowly within the existing range. It is expected that the organic silicon market will continue its weak consolidation trend, and the rebound breakthrough needs to wait for clearer signals.
Raw rubber market: Currently, the mainstream price for raw rubber is 14800 yuan/ton. On the supply side, the industry is actively reducing supply by significantly expanding production cuts. Enterprises have a firm willingness to raise prices, and inventory pressure has eased in the short term, providing bottom support for raw rubber prices.
On the demand side, downstream rubber mixing enterprises are constrained by weak terminal orders and capital recovery pressure, and their procurement strategies tend to be conservative, with replenishment mainly focused on sporadic small orders. And due to the current raw rubber quotation not meeting psychological expectations, coupled with the bearish inertia formed by the previous price decline, downstream consumers are more inclined to wait and see to lower prices and postpone purchases. The lack of elasticity on the demand side makes it difficult to effectively stimulate the market.
In the short term, the raw rubber market is in a game pattern of supply contraction to support the bottom and weak demand suppression. It is expected to maintain a narrow range of fluctuations, and there may be a slight downward shift in the price center. The future direction still needs to pay attention to the implementation of production cuts and the recovery of terminal demand.
Rubber mixing market: Currently, the mainstream quotation for rubber mixing is 13500-14000 yuan/ton. In terms of procurement, due to the current trend of stable and hidden decline in raw rubber, most rubber mixing enterprises are concerned about the risk of inventory depreciation, and their willingness to replenish inventory is generally low, resulting in a lack of inquiries. In terms of shipment, downstream product companies have insufficient orders and are adopting a wait-and-see attitude towards the procurement of rubber compounds, continuously lowering prices. Therefore, rubber compound companies are either forced to extend their payment terms or directly lower their quotations in order to win orders, both of which have increased profit pressure and capital occupation. To alleviate inventory pressure, some companies have generally compressed their output pace, focusing mainly on delivering pre order items with limited new transactions. Overall, there is no directional turning signal in the current mixed rubber market, and short-term weakness is difficult to change.
High temperature rubber demand side: In recent times, the terminal consumer market has remained sluggish, and the consumer recovery driven by high temperatures in summer has only provided temporary support for some daily necessities. Silicon product companies have significantly reduced their new orders, and the pressure to recover funds continues to increase. They maintain essential procurement for upstream rubber compounds and prioritize digesting existing inventory. In addition, the new national standard is about to be implemented, and related enterprises are still in the stage of adaptation in terms of process standards and testing requirements. The increase in technical barriers directly restricts the conversion of intended orders, forcing industry competition to shift from scale expansion to quality differentiation. In short, due to the lack of effective demand boost, the procurement pace of silicon product enterprises has slowed down, and there is a strong wait-and-see attitude, making it difficult to fundamentally reverse the weak market operation pattern in the short term.
Overall, the current organic silicon market is in a stalemate between production cuts and price increases, as well as weak demand, with insufficient cost support and downstream support forming a two-way suppression. Breaking the balance in the future depends on marginal improvement on the demand side or further tightening on the supply side beyond expectations, otherwise the market will remain in a wait-and-see sideways state. It is expected that the silicone market will continue to fluctuate narrowly, with limited room for both upward and downward movements.