Business Club News on April 22
(Jiangxi New Materials Co., Ltd.)
1. Price trend
According to the monitoring data of Business Society, the price of domestic silicone DMC is basically stable this week. The current mainstream quotation of domestic silicone DMC is about 14,000 yuan/ton, and the price is basically stable.
2. Market analysis
Product: The market price of organic silicon remained stable this week. Manufacturers basically produced pre-orders. The mainstream domestic quotations were basically at 14,000-14,500 yuan/ton, and the market transaction price was still around 13,800 yuan/ton. At present, domestic silicone companies have sufficient supply, and downstream factories mostly focus on inquiries and have little demand. In terms of equipment, domestic silicone manufacturers are currently operating at a relatively high load, with some manufacturers operating at full capacity. Manufacturers have sufficient inventory and weak shipments.
Industrial chain: At present, the upstream metal silicon market of organic silicon DMC continues to rise, especially the price of low-grade metal silicon. The spot is relatively scarce and the quotations continue to rise. Although there are still many companies suspending production of silicon metal manufacturers, it has improved compared to the previous period. The number of companies resuming production has gradually increased, making the price increase relatively gentle. There is no obvious large demand from downstream users of organic silicon, and the organic silicon market is mostly dominated by previous orders.
Industry: In 2015, the operating rate of the silicone monomer industry was basically maintained at full capacity. However, the monomer production capacity base increased in 2015. From this perspective, the operating rate of the monomer industry in 2015 is still mainly on a downward trend. In the past two years, the operating rate of the domestic silicone monomer industry has remained around the mid-range, and the phenomenon of insufficient operating load has become prominent. On the one hand, there has been a lot of new production capacity. In 2014, the new production capacity was about 320,000 tons. In 2015, the new production capacity was 250,000 tons, the production capacity base has increased, but the pace of production growth has been slow and the production capacity utilization rate is low; on the other hand, the tight supply of raw material silicon blocks in 2014 has eased in 2015, but the weak downstream demand has made it even more Obviously, the silicone market in 2015 was “slow in the peak season and even weaker in the off-season.” Market prices frequently hit bottom, and the mentality of individual companies to limit production and protect prices increased significantly during the year.
3. Market outlook
Analysts from Business Society Organic Silicones DMC believe that domestic silicone companies currently have sufficient supply, and downstream factories mostly focus on inquiries and have less demand. It is expected that the domestic silicone DMC market will be mainly stable in the near future.
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Relevant listed companies: Dongyue Group (00189.HK), Xin’an Co., Ltd. (600596.SH), Hongda New Materials (002211.SZ).
Contact information of Silicones DMC analyst of Business Society, Tel: 025-83337665, QQ: 347618859.
(Article source: Business Society)
