Entering this Wednesday, the silicone market once again saw a wave of upward trend. Yesterday, some individual monomer factories in Shandong announced an increase in DMC (dimethyl cyclic siloxane) prices by 300 yuan/ton to a new high of 13500 yuan/ton. This adjustment not only makes the factory's quotation more consistent with other individual factories, but also significantly reduces the price difference of DMC.

Recently, individual factories have adopted production reduction strategies to address the problem of market supply-demand imbalance. According to statistics, the production of DMC has dropped to 39800 tons last week, a decrease of 10000 tons compared to the same period in January. The facilities in Shandong, North China, and Central China have all maintained reduced load operation, while the facilities in Southwest and Northwest China have also been included in the production reduction plan. If these production reduction plans can be smoothly implemented, the shortage of spot goods on the supply side may further intensify.
Faced with this situation, midstream and downstream enterprises initially held a wait-and-see attitude and showed some resistance to high priced offers. However, with the gradual digestion of low-priced raw materials in the previous round, the order volume began to steadily increase. This is expected to stimulate the motivation of mid to downstream enterprises to chase after price increases and stock up again, thereby further pushing up DMC prices.
On the individual factory side, strict supply control is implemented, and price strategies are flexibly adjusted based on downstream orders. They plan to further adjust prices at the appropriate time to stimulate market stocking sentiment. From the current market game, individual factories clearly have the upper hand.
In the short term, DMC prices are expected to remain stable, with mainstream freight inclusive quotes remaining between 14000-14300 yuan/ton. However, with the continuous changes in market supply and demand, there is still a risk of price fluctuations.