A delay in start-up of new capacity alleviates the risk of intensifying oversupply, upcoming peak season shored up prices of silicone products 

DMC prices in the online shopping mall of Shandong-based factories opened at 15,200 yuan/mt this week, up 200 yuan/mt from pre-holiday levels. Leading DMC plants didn’t release offers, while others offered at 15,500 yuan/mt, up 200 yuan/mt. Mainstream transaction price was 15,500 yuan/mt. Post-holiday prices of silicone products moved up.

Domestically, post-holiday prices of silicone products moved up. DMC prices in the online shopping mall of Shandong-based factories opened at 15,200 yuan/mt this week, up 200 yuan/mt from pre-holiday levels. Leading DMC plants didn’t release offers this week, and then others increased offers or remained silent. Under this circumstance, downstream buyers rushed to purchase goods. Underpinned by strong demand, prices of silicon products hiked, especially MVQ. The main reason for the MVQ price uptick boiled down to two reasons. One reason was that downstream enterprises with stronger willingness to produce had robust MVQ demand. The other was that bad weather delayed arrivals, leading to MVQ supply tightness. Silicone oil price shot up due to low inventory and high cost. In addition, a delay in start-up of new capacity undermined the risk of intensifying oversupply. There was an expectation of strong performance of a peak season.

Looking forward, SMM estimated that prices of silicone products, mainly DMC, will keep hiking. With the arrival of the peak season and good terminal market, silicone product demand will be stronger. In addition, DMC plants’ low inventory have a big boost to DMC prices.