On the closing day of July, A-shares experienced a long-awaited surge, with over 5000 individual stocks rising. The organic silicon sector rose by 3%, with Luxi Chemical rising by 6.30%; Xin'an shares rose 4.16%; Xingfa Group rose 4.13%; Why the surge? According to relevant institutions, the heavyweight meeting held two days ago set the tone for economic work in the second half of the year. The emphasis on "the macro policy should be more awesome" and "not only to promote consumption, expand domestic demand, but also to increase residents' income" has reassured the market about economic recovery.
The stock market has experienced a sharp rise, and organic silicon has also welcomed a price increase letter! On July 31st, Xin'an Chemical issued a price increase notice: In view of the serious internal competition and vicious competition in the current industry's general products, and based on the need to maintain the healthy development ecology of the industry and Xin'an's own business, after careful and comprehensive evaluation, Xin'an's silicon-based materials business will adjust the prices of Xin'an's organic silicon and inorganic silicon series general products from August 15th, 2024 or the date allowed by the contract. Based on different product lines and markets, the average adjustment increase is 10%!
In addition, industrial silicon futures also rose sharply yesterday. Driven by various favorable factors, it seems that a new wave of price increases in August is really coming!
At present, the mainstream quotation for DMC is 13000-13900 yuan/ton, and the entire line is operating steadily. On the raw material side, due to the continued downward trend in demand for polycrystalline silicon and organic silicon, industrial silicon enterprises have average destocking capacity. However, the pace of production reduction is accelerating, and the price of 421 # metallic silicon has dropped to 12000-12800 yuan/ton, falling below the cost line. If the price further drops, some enterprises will voluntarily shut down for maintenance. Due to the pressure on warehouse receipts, there is still significant resistance to rebound, and the short-term stabilization is the main focus.
On the demand side, recent macroeconomic policies have played a positive role in the terminal market. In addition, the low prices of individual factories last week have stimulated downstream inquiries, and there may be a round of stocking up before the "Golden September", which is beneficial for individual factories to stabilize prices and rebound. From this, it can be seen that there is currently not much downward driving force in the market, and although there is some resistance to the upward trend, the August market is still worth looking forward to.
107 glue and silicone oil market: As of July 31st, the mainstream price of 107 glue is 13400~13700 yuan/ton, with an average price of 13713.77 yuan/ton in July, a decrease of 0.2% compared to the previous month and a decrease of 1.88% compared to the same period last year; The mainstream quotation for silicone oil is 14700~15800 yuan/ton, with an average price of 15494.29 yuan/ton in July, a decrease of 0.31% compared to the previous month and a year-on-year decrease of 3.37% compared to last year. From the overall trend, the prices of 107 glue and silicone oil are both influenced by major manufacturers and have not undergone significant adjustments, maintaining stable prices.

In terms of 107 adhesive, most enterprises maintained a medium to high level of production. In July, the stocking volume of large silicone adhesive suppliers was lower than expected, and 107 adhesive enterprises did not achieve their inventory reduction targets. Therefore, there was a lot of pressure to ship at the end of the month, and negotiations for discounts were the main focus. The decline was controlled at 100-300 yuan/ton. Due to the different attitudes of individual factories towards 107 adhesive shipments, orders for 107 adhesive were mainly concentrated in two large factories in Shandong and Northwest China, while other individual factories had more scattered orders for 107 adhesive. Overall, the current 107 rubber market is mainly driven by demand, with a slightly average trend of buying at the bottom and hoarding. With another individual factory announcing a price increase, it may stimulate market stocking sentiment, and it is expected that the market will continue to operate steadily in the short term.
In terms of silicone oil, domestic silicone oil companies have basically maintained a low operating load. With limited downstream stocking layout, the inventory pressure of various factories is still controllable, and they mainly rely on secret concessions. However, in June and July, due to the sharp rise of the third tier, the price of another raw material for silicone oil, silicone ether, continued to rise to 35000 yuan/ton, with high costs. Silicone oil companies can only maintain a stalemate, and under the weak demand situation, they can control the quantity of orders and purchases, and the loss face is also precarious. However, by the end of the month, due to the continuous resistance of downstream enterprises such as silicone oil to buying up, the prices of tertiary and silicone oil have fallen from high levels, and silicone ether has fallen to 30000-32000 yuan/ton. Silicone oil has also been resistant to purchasing high priced silicone ether in the early stage, and the recent decline is difficult to affect. Moreover, there is a strong expectation of DMC rising, and silicone oil companies are more likely to operate according to the trend of DMC.
In terms of foreign silicone oil: After the Zhangjiagang plant returned to normal, the tight spot market situation eased, but the domestic and international market conditions were generally average, and agents also lowered prices appropriately. Currently, the bulk price of foreign conventional silicone oil is 17500-19000 yuan/ton, with a monthly decline of about 150 yuan. Looking at August, a new round of price hikes has started, adding confidence to the high prices of foreign silicone oil agents.