SHANGHAI, Dec 30 (SMM) – SMM reported that the prices of organic silicon DMC stood at 16,300-17,300 yuan/mt as of December 30, with the average price down 180 yuan/mt from a week earlier. The prices of silicon oil stabilised at 19,000-20,000 yuan/mt, and the prices of 107 siliconrubber were stable and stood at 17,000-17,300 yuan/mt. The prices of 110 methyl vinyl silicone rubber also stabilised at 17,500-17,800 yuan/mt.

DMC plants were destocking aggressively this week ahead of the New Year’s Day holidays. One DMC plant in Shandong lowered its quotes significantly. DMC is currently quoted at 16,300 yuan/mt, 300 yuan/mt lower than the end of last week, and the lowest prices in the past two years. Other DMC plants kept their quotes stable but actually lowered their traded prices to boost transactions. Major DMC plants currently hold their quotes stable. However, more and more plants negotiated the prices and traded without online platforms. As of December 30, the mainstream traded prices in the market have dropped to around 16,700 yuan/mt.

The demand in real estate and other end-user industries has weakened due to a lack of manpower resulting from the COVID-19 pandemic. The lack of manpower across the silicon oil and silicon rubber enterprises also weakened the demand for DMC. Moreover, logistics was also significantly impacted, hampering the transportation of some cargoes. As such, trading volumes continued to decrease.

On the supply side, the productivity of DMC plants was stable with the operating rate of around 75%.

On raw materials, the SMM average price of #421 silicon (used in organic silicon) in east China continued to fall and stood at 19,700 yuan/mt on December 30. The prices of CH3CL in Shandong stood at 2,900 yuan/mt, and the cost of DMC decreased.

On the whole, end-user demand continued to decrease due to the impact of the COVID-19 pandemic. Lower costs weighed down the prices. And the prices are expected to move rangebound in the near term.