Just-in-time order releases have shifted the transaction center of DMC upwards; can the subsequent price increase continue? [SMM Analysis]

This week, silicone monomer enterprises began to raise their quotations, but the overall market transaction range remained stable, with the low prices maintained at 12,500 yuan/mt and the high prices from Xinjiang enterprises at 13,500 yuan/mt. Other enterprises' DMC transaction prices were slightly adjusted upwards to 12,800 yuan/mt this week, with quotations synchronously adjusted to around 13,000 yuan/mt.

This week, domestic monomer enterprises began to slightly raise DMC prices, with mainstream quotations and transaction prices both rising. The main reason, as SMM understands, is that domestic downstream enterprises have almost depleted their raw material inventories purchased for stockpiling during the peak season in September-October. Downstream enterprises have recently started just-in-time procurement, rapidly restoring trading volume, and the market's recent DMC supply has been limited. Shandong's new capacity mainly sells silanol fluid, and with strong support from the cost side, monomer enterprises under prolonged losses have shown a low willingness to sell at low prices, hence the price increase.

In terms of inventory, recent monomer enterprise inventory levels are relatively healthy, top-tier enterprises face low inventory pressure, and the industry's overall inventory is less than 70,000 mt, providing some support for price increases.

SMM believes that the DMC price range will remain stable, although the center has recently shifted upwards. However, this week, domestic silicon metal prices began to fall due to poor demand, weakening cost support. Additionally, this round of just-in-time stockpiling is gradually entering its final phase, and order volume performance is insufficient, so it is expected that DMC prices will oscillate within the 13,000-13,200 yuan/mt range for some time.