On Wednesday, the silicone sector rose sharply. As of press time, Sibao Technology rose nearly 10%, Xin'an shares rose more than 7%, and Sanyou Chemical, Dongyue Silicon, Chenguang New Materials, and Runhe Materials strengthened.
According to the investigation conducted by Sanyou Chemical, the company has an annual production capacity of 200,000 tons of organic silicon monomers. The main products are DMC, 107 glue, 110 glue, and hydrogen-containing silicone oil. In the first half of the year, the silicone market declined first and then rose. In the third quarter, the domestic silicone market was in the off-peak and peak season, and the off-season prices fluctuated and declined, and prices rebounded during the peak season of the Golden 9th Century. Recently, prices are still in the process of continuing to rise. First, due to the increase in overseas demand due to the epidemic, the demand for silicone products has shifted to the domestic market. Second, the operating rate of textiles and clothing is relatively high, and the demand for silicone oil products has increased. Overhaul, the supply side is slightly tight.
According to the research report of Minsheng Securities, according to Baichuan Information, the market price of silicone DMC climbed from RMB 16,000/ton at the end of July to RMB 24,000/ton on November 12, an increase of 50%, a new high in the past two years. Affected by the overseas epidemic, foreign manufacturers have low operating rates, superimposed on strong downstream demand, and significant pressure on the supply side. Last week, Zhongtian Dongfang Fluorosilicon Materials Co., Ltd., which produces 50,000 tons of organic silicon monomers per year, suffered a major accident. In the second half of the year, the new production capacity in the industry has been digested, and there will be no new production capacity in the short term, and the price of organic silicon is expected to remain high for a period of time.
Tianfeng Securities Research Report believes that the price of organic silicon continues to rise, with a price increase of 4.6% last week. The Zhejiang Zhongtian device caught fire, and the company's parking time is expected to be longer. Sudden accidents intensified market concerns. The current tightening prices are very obvious, and with the recent intention of some silicone companies to stop for maintenance, the market's fear of rising sentiment will once again stimulate the strong domestic silicone demand in the fourth quarter. The demand for high-temperature glue remains the same, but the demand for room temperature glue is general and exports. The increase in orders became the fuse of this price increase, and the current market demand has not yet cooled down.
In terms of configuration, Essence Securities Research reported that considering the successive landing of new domestic production capacity and the simultaneous increase in domestic and foreign demand, the silicone industry will face a boom in supply and demand in the future. Xin'an shares with flexible targets are recommended, and Hesheng Silicon Industry and Dongyue Silicon Materials are recommended.
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