Silicone Product Prices Increased, New Orders Were Mainly Driven by Rigid Demand [SMM Silicone Weekly Review]

SMM News, March 5:

Cost: On March 5, east China #421 silicon (used in silicone) was at 9,850 yuan/mt, down 150 yuan/mt WoW; east China #421 silicon was at 9,550 yuan/mt, up/down 100 yuan/mt WoW. This week, silicon metal futures prices fell first and then rose; after the spot price trend declined, it stabilized and quotations rose. With weak supply and demand fundamentals, there was still pressure on the upside, and prices fluctuated and consolidated. Methyl chloride prices showed a rise, with mainstream market transactions at 2,200 yuan/mt. Overall integrated costs rose WoW, and monomer enterprises saw an overall increase in costs.

DMC: This week, domestic silicone DMC market prices rose, with the mainstream quotation range raised to 14,000-14,300 yuan/mt, up 250 yuan/mt WoW. By regional quotations, monomer enterprises in Shandong quoted 14,000 yuan/mt, up 200 yuan/mt from the previous period; mainstream monomer enterprises in other regions quoted 14,300 yuan/mt, up 300 yuan/mt from the previous period. After this price increase, new deals in the market were mainly just-in-time procurement. Ahead of the meeting, midstream inquiry and purchase activity increased, coupled with support from the export orders window, and monomer enterprises generally took orders well; some producers’ presale orders had already covered March production. On the supply side, the industry’s new round of emission-reduction intensity increased to 35%, and overall supply remained tight. Together with relatively strong raw material prices providing cost support, domestic silicone DMC market prices were expected to remain firm in the short term.

Silicone oil: This week, silicone dimethyl silicone oil market prices rose, with conventional viscosity prices at 15,500-16,100 yuan/mt and an average of 15,800 yuan/mt. Driven by price-hike sentiment, the overall number of inquiries increased, but end-use demand had yet to change. With raw material support still in place, downstream procurement tended to be cautious; new deal volumes were relatively limited. However, as prices continued to be passed down, subsequent order-taking was expected to improve.

107 silicone rubber: This week, 107 silicone rubber prices rose 300 yuan/mt WoW, with conventional viscosity market quotation range at 14,500-15,100 yuan/mt and an average of 14,800 yuan/mt. Although it was the “Golden March” period, with overall market demand still unclear, there had been no incremental change. Some downstream clients were still mainly consuming raw material inventory and remained cautious in accepting the new prices; new deals were mainly just-in-time procurement.

MVQ: This week, the MVQ price range was about 14,900-15,300 yuan/mt, with an average of 15,100 yuan/mt, up 300 yuan/mt WoW. Supported by the DMC price increase, its price also rose in tandem. Before last week’s price hike, some downstream enterprises had completed monthly rigid-demand procurement, and overall trading volume remained relatively conservative.