Today, Xinyue's "price increase" has officially come to fruition. For half a month, some manufacturers have reported that they have placed more orders. Under the heat of the price increase market, the trading sentiment in the organic silicon spot market has gradually recovered. Recently, there have been manufacturers scheduling orders for one month. Another factor affecting the trend of organic silicon is that the freight prices from Asia to the west coast of North America and northern Europe have risen to approximately $7000/FEU, which is 40% -50% higher than the 2024 high reached in January and February. The shipping cost from Asia to the East Coast exceeds $8000/FEU, which is 20% higher than in February. As cross Pacific demand is expected to peak in August, freight rates may continue to rise.
It is reported that this week, the raw material industrial silicon chloroform rose by 100 yuan to 2200 yuan/ton, while the 421 # metal silicon fell by 100 yuan to 13.4-14 yuan/KG, and the mainstream DMC quotation was 13.5-13.9 yuan/KG. Sources have revealed that DMC's rubber leader may raise prices for the first time in early July, with a range of around 100-200 yuan. In the second quarter, the overall organic silicon market continued its weak recovery trend, with supply and demand increasing month on month and a stable trend continuing year-on-year. On the one hand, the enthusiasm of individual enterprises to reduce production and control goods has slightly rebounded. The supply in the second quarter decreased by 5% compared to the first quarter, but the cumulative year-on-year increase is still 10%. Especially for top enterprises, the production capacity has increased significantly, and the supply is more significant; On the other hand, thanks to the influence of brand and price, the order volume in the second quarter steadily recovered, and the resilience of top silicon companies was better than that of second - and third tier silicon companies. The transaction price in June stopped falling and stabilized.
In the past decade, it has been an era of rapid advancement of organic silicon. However, the pain of winter is paying for the mistakes of summer; The sudden advancement of the industry also laid the groundwork for the downfall of many organic silicon enterprises later on. Twelve years later, under the dual carbon trend, organosilicon remains a "star" in various industry categories and still receives attention from both industry and capital levels. At present, praise and doubt are intertwined, seawater and flames accompany each other, vast market prospects and various obstacles converge, and the organic silicon industry once again enters a deep-water area of reshuffle. Shuffle is a process, not a result; The cycle of "cold winter" is a stage where survival of the fittest is necessary, rather than the entirety of industrial trends. Last year at the Shenzhen Fluorosilicon Exhibition, a single company announced that after the third reshuffle, one-third of the organic silicon companies would be eliminated. At that time, I believe few people expected the speed and severity of the shuffle to become so rapid day by day!
Recently, at multiple exhibitions in Shanghai, Suzhou, Guangzhou, and Shenzhen, industry experts such as Mr. Ding, Mr. Li, Mr. Fan, and Mr. Liu pointed out that the organic silicon industry has encountered the strongest internal competition in history, with a serious mismatch between supply and demand, and the industry has entered an ice age. The underlying reasons are the combination of factors such as excessive homogenization competition on the supply side, blind obedience of capital, cross-border squeezing, local government investment and construction agency driving, and the demand side's low price competition for the market, which has led the organic silicon industry into a trap of "local optimum" rather than "global victory". In their view, currently, the domestic organic silicon industry is in an important transition period of both the best and worst times, breaking through the cocoon and becoming a butterfly in pain. What the industry is going through is not the cyclical iteration of the past three to five years, but a rehearsal before the arrival of the era of organic silicon transformation. With the promotion and end of the third major reshuffle of organic silicon, the old era of an industry is about to come to an end, and a new era is slowly beginning. Mr. Fan believes that after experiencing cycles and hardships, organic silicon will eventually usher in unprecedented development.
Single unit device dynamics: With the arrival of high temperature weather, the overall operating rate has fallen, and factories with insufficient orders have started to shut down for maintenance. The domestic operating rate is around 69%.
Normal operating devices: Dow, Xinyue, Wake, Hesheng, Luxi, Inner Mongolia Xingxing, Inner Mongolia Hengyecheng
Load reduction devices: Zhejiang Zhongtian, Hebei Sanyou, Dongyue, Xin'an, Jiangxi Xinghuo, Hubei Xingfa, Yuntou
Metal silicon market: The domestic 421 # metal silicon market continues to fluctuate slightly, with mainstream market grades falling by 100 yuan/ton to 13400-13950 yuan/ton. At present, the overall production and supply of metal silicon factories are very abundant, while downstream demand is still affected by the off-season, and the fundamental stability mentality is still biased.
DMC Market: The domestic DMC market fluctuates between 100 and 200 yuan, with prices ranging from 13500 to 13900 yuan/ton. The capacity utilization rate of individual enterprises has slightly decreased, and some enterprises plan to reduce production in the later stage. In the short term, the market has sufficient spot supply, and the market continues to operate at a bottom.
Silicone oil market: The domestic silicone oil market is weak and volatile. The price of raw materials has stopped falling, and cost support has weakened. Anhui's top silicone oil brands reported over 16000 yuan/ton, cracking material silicone oil reported over 13000 yuan/ton, and Dow Xinyue Wacker silicone oil reported 19500-21500 yuan/ton. On the demand side, downstream purchases are mostly on demand, and the overall trading atmosphere in the market is average, with actual orders negotiated.
107 glue market: The domestic 107 glue market is operating steadily, with mainstream market brand prices fluctuating by 50 yuan/ton. Imported 107 glue is priced at 15500-16500 yuan/ton, while domestic mainstream brand prices are priced at 13850-14800 yuan/ton. The price of cracked 107 glue is reported at 13200-13500 yuan/ton. This direction is booming, and the demand side silicone adhesive market is expected to continue to grow. Top silicone adhesive companies are expected to demonstrate the Matthew effect, and the long logic of industry expansion and concentration continues to unfold. It is expected that the compound annual growth rates of building adhesive, photovoltaic adhesive, and electronic adhesive will reach 7%, 10%, and 13% respectively by 2026, and the silicone adhesive consumption market is expected to continue to expand. At present, the concentration of silicone adhesive industry in China is still relatively low, with industry CR10 only accounting for 23%, while the mature overseas market CR10 has reached 70% or more, and there is still significant room for improvement. The long-term logic of expanding and concentrating the silicone adhesive industry in the future is expected to continue to unfold.