Downstream Rigid-Demand Orders Followed Up, Silicone Product Prices Remained Strong [SMM Silicone Weekly Review]

SMM, August 13:

Costs: On August 13, the average east China #421 silicon (used in silicone) price was 9,500 yuan/mt, flat MoM, and the average east China #421 silicon price was 9,350 yuan/mt, flat MoM. This week, silicon metal prices were firm, with silicon suppliers offering flat or slightly higher prices WoW, while downstream sentiment was mostly wait-and-see and transactions were mainly driven by rigid demand. Methyl chloride prices were basically stable, with the market average price at about 2,600 yuan/mt; the overall production cost of silicone monomer enterprises was stable WoW.

DMC: This week, China's silicone DMC price center moved higher, with quoted prices in the range of 13,000-13,500 yuan/mt. Expectations for coordinated industry production cuts, combined with sustained downstream rigid-demand orders, drove silicone monomer enterprises to raise quotations, and low-priced supply in the market decreased. Supply side, the joint 50% production cut plan agreed at the August industry meeting continued to advance, but implementation intensity varied among enterprises, and the operating rate in early August remained above 60%. In terms of monomer enterprises' order-taking, they currently have sufficient pre-sale orders and no sales pressure; a few enterprises have pre-sale orders scheduled to early September, and industry pre-sale orders range from late August to early September. Siloxane inventories at monomer enterprises are low, and enterprises are mostly bullish. Overall, China's DMC price center is expected to slowly rise from 13,000 yuan/mt to around 13,500 yuan/mt in the short term.

Silicone oil: This week, the transaction price range for conventional-viscosity dimethyl silicone oil was 14,500-15,500 yuan/mt, with an average price of 15,000 yuan/mt, up WoW. Cost side, raw material DMC prices continued to rise, providing cost support for silicone oil, and silicone oil quotations rose accordingly. Demand side, downstream clients mainly restocked for rigid demand and purchased cautiously; silicone oil enterprises had low inventories and showed strong sentiment to hold prices firm and raise offers.

107 silicone rubber: This week, conventional-viscosity 107 silicone rubber market prices showed a firm upward trend, with a range of 13,500-14,000 yuan/mt. Supply side, pre-sale orders were sufficient, with no short-term inventory pressure, and factories had relatively strong willingness to hold prices firm. Demand side, downstream players maintained only rigid-demand restocking, showed limited willingness to chase higher prices, and market wait-and-see sentiment was relatively strong.

MVQ: This week, MVQ market prices reached 14,000-14,500 yuan/mt. Driven by earlier low-price selling, downstream buyers bought the dip and stockpiled, and MVQ enterprises' inventories were transferred. This week, raw material DMC prices were firm and cost support strengthened; under these dual factors, MVQ prices were driven up, but downstream customers prioritized destocking and remained cautious about chasing further gains.