Rising costs lead to an increase in DMC quotes, while procurement demand remains sluggish [SMM Silicone Weekly Review]

SMM reported on July 17:

Cost: This week, the average price of #421 silicon (used in silicone) in east China was 10,000 yuan/mt, maintaining stability. The average price of #421 silicon metal in east China was 9,500 yuan/mt, with a 400 yuan/mt increase this week, driven by recent demand-boosting policies. The spot market prices of silicon metal have maintained an upward trend. The price of monochlorosilane remained stable this week, with mainstream transaction prices at 1,900 yuan/mt. The comprehensive cost increased WoW, adding further cost pressure to monomer enterprises.

DMC: This week, monomer enterprises in Shandong province quoted DMC at 10,800 yuan/mt, a 100 yuan/mt increase WoW. Other domestic monomer enterprises' DMC quotes remained stable this week, with the mainstream transaction center maintaining around 10,800 yuan/mt. Low-price quotes in the domestic market rose slightly this week, with a decrease in matching degree for transactions. Recently, downstream enterprises have had sufficient raw material inventories and limited purchasing willingness. Therefore, this week's market saw quoted prices rise but actual transaction prices remain unchanged temporarily. Downstream demand still awaits recovery during the "September-October peak season."

Silicone oil: In terms of price, the price range of dimethyl silicone oil with conventional viscosity was 12,800-13,200 yuan/mt, with a relatively low transaction center. In terms of supply, multiple small and medium-sized factories in central and southern China have entered maintenance and production cut status due to the continuous high temperatures, resulting in a slight decrease in supply. In terms of demand, there has been no signal of improvement in end-use demand, so downstream enterprises' purchasing remains rational, mainly driven by immediate needs. Therefore, in the short term, the dimethyl silicone oil market will remain in the doldrums.

107 silicone rubber: In terms of price, the current price range of 107 silicone rubber with conventional viscosity is 11,000-11,500 yuan/mt, with actual transactions generally close to the lower limit of the range. In terms of demand, due to the increase in finished product inventory turnover days for downstream enterprises, they maintain a low-inventory strategy for raw material purchases, so transactions continue to follow a small-order, immediate-need model. The supply side remains in normal operation, with surplus pressure still existing. In the short term, downstream enterprises currently lack confidence in the subsequent market, with strong wait-and-see sentiment. Therefore, market transactions will remain at immediate-need levels.

MVQ: This week, the price of silicone MVQ was 12,000-12,400 yuan/mt, with an average price of 12,200 yuan/mt, a 200 yuan/mt increase WoW. Recently, MVQ quotes have slightly increased due to rising costs. Currently, downstream enterprises' acceptance willingness is moderate, with purchasing sentiment slightly higher than for other products. However, current price changes are heavily influenced by costs, and downstream demand has not shown significant improvement. Recently, MVQ prices still exhibit a fluctuating trend.