Raise the price but sell it! Silicone in "doing things", market analysis and forecast [Weekly]
As soon as July entered, the silicone market continued to rise slowly and steadily at the end of June. With the help of the outbreak of low-priced hoarding orders in the previous two weeks, the pre-orders received by single factories were relatively sufficient. Most factories scheduled production until mid-late July, and the early high inventory was successfully transferred to the downstream. Therefore, many single factories closed or received orders in limited quantities. Manufacturers raised 600 yuan/ton last week and 400 yuan/ton again today. DMC's current quotation ranges from 17,000 to 17,500 yuan/ton. At present, the upstream manufacturers have a strong pull-up mentality, but the downstream enterprises are not very "buy", who can take more initiative in the end?
Silicone oil market: supported by DMC, silicone oil is still on the rise this week. Meanwhile, the impact of low-price imported methyl silicone oil on the market is gradually weakening, and prices have begun to rise in varying degrees. The price of cracking silicone oil has also increased significantly due to insufficient start-up of enterprises and tight supply. The downstream currently holds a cautious view on the rise of silicone oil, which just needs to be purchased. However, the inventory pressure of silicone oil enterprises has been greatly alleviated due to the large number of orders received in the early stage of low-level hoarding. With the rising cost, the price-opening mentality is relatively adequate. It is expected that the silicone oil enterprises will continue to follow up the cost increase in the short term. However, it should be noted that downstream demand is not satisfactory, which has created a negative effect on the rise of silicone oil. Therefore, many industry insiders believe that this round of price increases will not last too long.
107 glue market: last week 107 glue slightly increased, due to the DMC price rebound stimulus, the cost focus continues to rise, 107 glue market steady upward. Downstream manufacturers and distributors have been building warehouses in the past two weeks, resulting in low inventory of 107 rubber manufacturers, production scheduling plan has reached mid-July, the supply of goods is slightly tight. This week, there is a single manufacturer 107 glue installation repair, import 107 glue supply is also somewhat tight, agent quotation slightly increased, at present, most manufacturers give early orders. Because the downstream is not very optimistic about the July rally, the enthusiasm for future rallies is not high after some raw materials are copied at the bottom. This week's high-priced transactions or are mainly just needed. It is expected that 107 glue will run steadily in the short term, and the price will still be slightly increased by DMC.
Cracking Material Market: Recently, the cracking material market is affected by new materials. Although the price is rising continuously, the increase is basically consumed by waste silica gel. Waste silica gel recyclers and silica gel manufacturers are reluctant to sell their trays seriously. Last week, the price of waste silica gel (wool edge) was 6200-6400 yuan/ton (excluding tax). At present, the price of cracking material silicone oil and 107 gel is not much different from that of new material. Therefore, the image of purchasing waste silica gel is still low and the start of construction is generally insufficient. Several pyrolysis plants indicated that inventories were low and prices remained firm, especially in the strong upward phase of new materials, and there were still upward expectations in the near future. But the subsequent recyclers of waste silica gel will also take advantage of the opportunity to raise prices. Because of the embarrassing situation that the price of pyrolysis materials has risen but the profit has not risen in recent years.
Silicone rubber market: At present, the most vigorous growth is the raw rubber market. Last week, the raw rubber market continued to rise, and the phenomenon of closure and pull-up has an expanding trend. Blended rubber enterprises are frequently blocked from taking goods, and the focus of raw rubber transactions is constantly shifting. Mixed rubber enterprises are driven by raw rubber, and the price is also rising, but the increase is smaller than that of raw rubber. Firstly, the main factories of mixed rubber have a small increase, and the small and medium-sized mixtures can only follow; secondly, the downstream terminal has a weakening acceptance of high prices, and the orders for low-priced and large-scale stockpiling in the early stage have not yet fully arrived, and the market is high. The image of price reserve is not high. At present, the mixing plant has a better delivery. Because of the size of raw rubber stockpiled at low prices in the early stage, the current profits are also quite different. It is expected that endogenous rubber will continue to rise in the short term and the mixtures will follow up, but whether the rising trend can be conducted smoothly is still unclear.
In summary, the supply pressure of the market has been alleviated in the near future, and the inertia of upstream enterprises to implement the tap operation strategy further strengthens the support role of the market. However, downstream manufacturers said that at this time, more consideration may be to stop the price decline. Despite negative demand, upstream manufacturers continued to rally this week. Combined with the rebound of silicone bottoming in this round, the price has risen by about 1500 yuan/ton from the previous lowest level. With the price rising, the desire to continue low-price hoarding downstream will gradually dissipate, which can successfully support the continued higher prices or only rely on actual demand. It is expected that this round of rising prices will remain until mid-July. In the face of new capacity coming into operation, the risk of DMC's continued strong pull-up will gradually accumulate.
From Silicone Mall