At the end of August 2026, China’s chemical market is still trapped in the summer off‑season atmosphere. Sustained high temperatures restrain operating rates of downstream industries such as rubber and composite materials. Coupled with production constraints brought by energy‑consumption control, most downstream enterprises operate with low‑inventory levels and mainly adopt demand‑based restocking. The market holds certain expectations for the Golden‑September peak season, yet no substantial recovery has occurred in end‑user consumption, and wait‑and‑see sentiment prevails. The divergent pattern of the silica industry is further intensified. Ordinary precipitated silica faces multiple tests including high inventory, thin profit margins and fierce market competition. Demand for modified special‑grade silica applied in new‑energy tires, organosilicon sealants, photovoltaic materials and electronic devices remains resilient, serving as a vital growth pillar for the industry. Intertwined factors including raw‑material cost pressure, domestic capacity‑structure adjustment, slower‑than‑expected downstream recovery and rising overseas carbon‑trade barriers keep reshaping industrial competition landscape.

  In the upstream raw‑material segment, affected by plant maintenance and energy‑consumption‑quota control, sodium silicate, the core feedstock for precipitated silica, sees limited supply release and maintains high‑level prices, providing rigid cost support for silica. Sulfuric acid is in adequate overall supply. However, downstream fertilizer sectors are in the traditional off‑season with weak purchasing demand, and sulfuric‑acid prices fluctuate at low levels, partially offsetting cost increases caused by sodium silicate. Industrial electricity consumption hits annual highs in summer, pushing up electricity costs and further raising comprehensive production costs of precipitated silica. For numerous small‑and‑medium‑sized manufacturers, raw‑material and energy costs rise simultaneously, continuously squeezing profit margins of ordinary grades. Some enterprises voluntarily lower operating loads to reduce inflow of low‑price goods into the spot market so as to avoid loss risks. Raw‑material markets witness no dramatic price surges or slumps, while a solid cost base strongly underpins finished‑product quotations.

  On the supply side, the overall operating rate of domestic precipitated silica stays at 70‑72%. The industry boasts huge total capacity, yet operating‑rate gaps among enterprises are obvious. Backed by stable long‑term orders, leading enterprises maintain relatively high‑load plant operation and keep promoting product‑mix optimization. They cut output of low‑value‑added general rubber‑grade silica and shift capacities toward high‑dispersion and surface‑modified special‑purpose grades. Suffering dual pressures of rising costs and vicious low‑price competition, small‑and‑medium‑sized enterprises flexibly adjust operating rates according to market conditions. They prioritize delivery of long‑term orders for regular clients and voluntarily reduce spot‑market shipments. Few new‑capacity projects target traditional general‑purpose precipitated‑silica lines; most are deployed in high‑value‑added tracks such as new‑energy tires, organosilicon products and electronic auxiliary materials. Inventory divergence remains a core market contradiction. General‑purpose grades for tire filling and common rubber applications hold medium‑to‑high inventory, bringing heavy de‑stocking pressure. By contrast, modified silica for new‑energy and photovoltaic‑energy‑storage sectors is in tight supply, and order backlogs of many manufacturers extend to mid‑to‑late September. The fumed‑silica market also presents a bipolar trend. Ordinary hydrophilic grades face cut‑throat competition with sideways price fluctuations, while high‑end special grades for electronic and photovoltaic adhesives are constrained by organosilicon‑monomer supply and enjoy prominent bargaining advantages.

  The downstream market as a whole features weak real‑time demand alongside rising peak‑season expectations. As the largest consumption field of silica, domestic tire enterprises maintain operating rates of 72‑77%. Downstream factories stick to hand‑to‑mouth purchasing without large‑scale centralized stock‑building. The traditional replacement‑tire market is dominated by stock‑based demand with limited short‑term increments. Green tires for new‑energy‑vehicle applications achieve steady growth and continuously boost demand for high‑dispersion silica. Downstream buyers keep raising requirements for impurity control, batch consistency and carbon‑footprint indicators, which becomes the most important growth source for the tire segment. Silicone rubber and sealants possess strong anti‑cyclical capability. Continuous order releases of photovoltaic‑energy‑storage‑supporting adhesives drive stable consumption of reinforcing silica. Traditional sectors including coatings, feed additives and daily‑chemicals see stable demand with limited new orders, dominated by stock‑based competition. Approaching September, only a small number of downstream enterprises carry out small‑batch tentative stock‑up, most participants remain cautious, and large‑scale restocking has not materialized.

  Structural divergence continues to unfold in export markets. General‑purpose silica products are impacted by overseas local‑capacity expansion and multi‑country competitors. Overseas buyers show obvious price‑suppression tendency, and export resistance for ordinary grades keeps mounting. Benefiting from stable product quality, high‑dispersion modified special‑purpose silica achieves steady growth in overseas orders. Relevant overseas carbon‑border‑trade policies keep being implemented. Importers continuously lift review thresholds for carbon footprint, production traceability and compliance documents. Enterprises without green‑process upgrading face markedly increased export obstacles. The survival space for the previous low‑price‑high‑volume export model keeps shrinking. Enterprises with completed low‑carbon renovation and sound carbon‑accounting systems gain enhanced overseas competitiveness. Export competition has evolved from simple price rivalry into comprehensive competition covering product quality, carbon‑management capabilities and customized services.

  From the perspective of enterprise operation, profit gaps within the industry keep widening. SMEs focusing on general‑purpose grades are mostly at slim‑profit status and face loss‑making risks in certain periods under dual squeeze from rising costs and vicious low‑price competition. Relying on technical accumulation and tight market supply, enterprises engaged in high‑end modified‑product business maintain favorable profitability. The proportion of R&D investment across the whole industry rises steadily. More enterprises pivot to emerging downstream tracks, optimize product structures and reduce the proportion of low‑end products. Industrial reshuffling moves forward steadily. Small‑and‑medium‑sized capacities lacking technical reserves and competent cost‑control capabilities are confronted with intensified survival pressure, and the phase‑out pace of backward market capacities accelerates moderately.

  Market outlook: the off‑season trend will continue in the short run, and general‑purpose silica grades maintain weak‑stable performance. Solid cost support limits downside risks; nevertheless, recovery of real downstream demand is slow, peak‑season expectations have not been fulfilled, upward driving force is insufficient, and the probability of sharp price rises or falls is low. Supported by demand from new‑energy and organosilicon tracks, high‑end modified special‑purpose grades keep firm market sentiment, and some short‑supplied grades enjoy premium space. After entering September, close attention should be paid to production‑recovery performance and actual restocking intensity of tire, rubber‑goods and sealant manufacturers, as well as continuity of overseas orders and release rhythm of new high‑end special‑purpose capacities. In the medium‑and‑long‑term perspective, energy‑consumption control, environmental‑protection constraints and overseas carbon‑trade barriers will keep pushing backward capacities out of the market. Enterprise competition no longer merely focuses on capacity scale, but shifts toward comprehensive strengths including modification technologies, cost control and full‑chain green manufacturing. The structural trend of “pressure on general‑purpose products while benefits go to special‑purpose products” in the silica industry will persist.