Yesterday, the DMC market quotation remained stable in the range of 13400-14000 yuan/ton, but there were hidden market currents surging. It is worth noting that mainstream individual factories have initiated a gradual production reduction plan, reducing the supply scale by lowering the device load rate and simultaneously releasing signals of price increases. According to industry data, the current industry operating rate has decreased by 5-8 percentage points compared to the beginning of the month, providing strong support for price bottoming out.

Faced with upstream fluctuations, midstream and downstream enterprises are showing a dual situation of ice and fire: some processing enterprises are actively implementing the strategy of stocking up on dips based on cost transmission prediction, and the turnover days of raw material inventory have increased by 20% compared to the previous month; Enterprises with high inventory pressure (currently with an average inventory cycle of 35 days) maintain a cautious attitude and choose to postpone procurement until the market becomes clear. This differentiation pattern reflects the differentiated expectations of price trends in different links of the industrial chain. From the perspective of industrial transmission logic, 1) supply side contraction directly reduces market circulation, 2) weakened economies of scale push up marginal production costs, and 3) cost driven price increases form a self reinforcing mechanism. According to calculations, for every 1 percentage point increase in the current production reduction, it will support a central shift of about 200 yuan/ton in DMC prices.
Based on the dynamic situation of both supply and demand, it is expected that DMC prices will show a stepped upward trend, with a strong support level of 13400 yuan/ton in the short term. This week, we need to focus on two major indicators: 1) whether the mainstream manufacturers' price adjustment announcements have been implemented today, and 2) the month on month changes in the inventory volume of enterprises within the week. If the implementation of production reduction continues to increase, there may be a potential increase of 150-300 yuan/ton within the week.
Last year, the overall demand for overseas organic silicon showed a stable trend, and its growth was mainly driven by two factors: firstly, the global economic recovery effectively stimulated the market demand for the entire organic silicon industry chain; Secondly, international enterprises continue to implement industrial layout adjustments, while transferring primary product production capacity to China, focusing on developing technological innovation in downstream deep processing fields. This industrial synergy effect significantly enhances the international market's dependence on Chinese organic silicon products. Recently, the domestic organic silicon market entered a post holiday upward trend, with prices in the upstream and downstream industrial chains showing an accelerated upward trend. As of February 17th, the price of hydrolyzed products is reported at 12800-13700 yuan/ton, the mainstream spot price of DMC is reported at 13400-14000 yuan/ton, the mainstream spot price of raw rubber is reported at 14500-14800 yuan/ton, the mainstream price of 107 rubber is reported at 13800-14200 yuan/ton, the mainstream price of domestic silicone oil is reported at 14800-16500 yuan/ton, and the mainstream price of imported silicone oil is reported at 18500-19500 yuan/ton. 421 # metal silicon is reported at 12500-13100 yuan/ton, chloromethane is reported at 2650-2750 yuan/ton, and high hydrogen silicone oil mainstream is reported at 7500-7800 yuan/ton. The pace of production reduction on the production side has significantly accelerated, and the tight supply-demand balance in the market is favorable. Industry insiders have analyzed that under the combined effect of the new cycle of high-quality development and the demand replenishment period, the price of organic silicon will continue to maintain a strong operating pattern in the short term, and the process of reducing production and capacity in the industry may further accelerate.