Entering Tuesday, the silicone market continued to experience weak fluctuations. From the current situation, in the context of weak terminal demand, downstream enterprises tend to focus more and move less. In order to stimulate transactions, there are many upstream profit sharing operations. With the intensification of bearish sentiment, downstream enterprises have gradually deepened their expectations for the bottom, and can only wait and see. They dare not rush into stocking up easily. In terms of individual factories, the current mainstream quotation for DMC is 13300~13900 yuan/ton, and the actual transaction continues to be mainly based on secondary bidding and negotiation of discounts.
At present, the continuous decline of industrial silicon has put certain pressure on the stable price of organic silicon. It is understood that some DMC transaction prices have pushed into the 13000 mark. However, mainstream manufacturers have a strong mentality of maintaining profits, and the industry has generally reached a consensus that the current market cannot be dealt with solely through rough price wars. Each manufacturer needs to take multiple measures and strike a combination of cost reduction and efficiency improvement. Therefore, although the willingness of individual factories to ship is becoming stronger, price adjustments are still very cautious, with small actions not stopping and big actions difficult to come by.
On the cost side: From the supply side, silicon factories in Sichuan and Yunnan have basically resumed production with high operating rates, while there has been no substantial improvement on the demand side. In terms of polycrystalline silicon, due to severe inventory accumulation in downstream silicon wafer links, there is a strong willingness to reduce production; In terms of organic silicon, the negative feedback impact of orders from bottom to top continues, which has a general impact on industrial silicon procurement.
Under the pattern of strong supply and weak demand, the pressure on industrial silicon warehouse receipts has further emerged, and the market continues to decline. Yesterday, the Si2409 contract price closed at 10505 yuan/ton, a decrease of 385 yuan, breaking the new low since its listing; In terms of spot goods, 421 # metal silicon is priced at 12900-13600 yuan/ton, with a price reduction of 50-150 yuan. In addition, the price of chloromethane in Shandong region is 2100 yuan/ton, a slight decrease of 100 yuan. Overall, the continuous downward pressure on the cost side not only repairs the profits of individual factories, but also promotes the risk of further decline in DMC prices. In the short term, it is necessary to focus on the situation of the industrial silicon market.
In terms of operating rate: Currently, most individual factories are operating at a medium to high level, with an overall operating rate of over 70%. In the short term, there are still a few individual factories that actively reduce their production capacity, and some new production capacity in East and Central China is still in trial operation. In order to maintain market stability, subsequent production reduction is still an important operation for each individual factory.