The current domestic silicone market environment
1. Supply-side reform is not just talk That’s all.
Anti-corruption, everyone thinks it’s okay to shout about it every year It’s amazing. The result is now at the Standing Committee level. The depth and breadth are still continuing, and we have high expectations.
Supply-side reform was originally thought to be just a noun, but now It seems that it is also an exploration to achieve profound changes in the development mode. Against the background of environmental protection and production capacity reduction, the profits of Chinese enterprises have not decreased but increased, which is worth pondering.
Therefore, supply-side reform is firstly supported by information technology The second is to change the original extensive, low-yield and environmentally sacrificial development model.
As the world’s factory, we have done so much, After paying so much, companies often still lose money, which is unsustainable; companies have no benefits and cannot continue to invest in research and development, and our position in the world’s industrial chain pattern cannot be changed.
In the field of mobile Internet, we have made a counterattack;
Can this round of environmental protection storm promote a change in the development model of the chemical industry?
From an enterprise perspective , prices skyrocketed, scale expanded,Still stuck in short-term thinking.
Can we consider the direction of the country this way: from the perspective of sustainable development, we must cherish resources and the environment, and can we do less?
; Can you make some innovations, from imitating foreign products to leading new applications?
2. Let’s talk about the short-term price influencing factors:
The fundamental basis of price is the relationship between supply and demand. Factors affecting supply will have an impact on price.
1. Environmental protection inspection: Environmental protection inspection is unprecedentedly intensive, with immediate impact wherever it goes. Therefore, if the scope of inspection involves relevant suppliers, the supply will inevitably be affected; especially the haze in the north in winter and spring will have a greater impact. From now on, the country is determined to fundamentally change. Enterprises within the scope must do a good job in environmental protection, and even if they do well, they may be affected. After all, some policies are one-size-fits-all. In addition, the impact of the acid balance problem caused by the seepage pit incident in the north on related companies is expected to be difficult to solve in the short term. This is also one of the reasons why the production capacity of individual companies in the north has been insufficient for a long time.
2. Safety supervision and inspection: Environmental protection has become a hot topic, and safety supervision has also begun to exert its efforts. Although the intensity is smaller, it will still have an impact on the start-up of newly built and renovated enterprises, which will delay the progress.
3. Major political events and important holidays. The reversal of the silicone industry is due to the G20. The 19th National Congress, the annual two sessions, major sports events, etc. will have a huge impact on the surrounding companies within 200 kilometers.
4. Resource industries: The resources involved in organic silicon are mainly metallic silicon, methanol and chlor-alkali industries. Some other small units. The G20 is a political influence, the later period is the continuation of environmental protection, and this round is environmental protection + resource influence.
5. The amplification effect under new media. In fact, there is a contradiction between supply and demand, but the deviation is sometimes not that big. However, in the new media era, it is quickly amplified, causing huge fluctuations in the industry. Looking at the reports on various micro-platforms, we can see the same pattern. The information seems to be transparent, but in fact it often goes astray.
3. Long-term trend: Prices fluctuate around value, but rising costs and rising values are trends, and the industry maintains reasonable profits:
1. The first supply-side reform is the improvement of efficiency; big data, intelligent robots, the Internet of Things, and new tools will reshape our production and lifestyle, which is driven by technology;
2. Supply-side reform The second is the improvement of reasonable profits based on innovation. However, the development philosophy of Chinese entrepreneurs has not changed, especially in the traditional chemical industry. Environmental protection and safety supervision are both means, but the fundamental thing is the change in the development philosophy of the entrepreneurial group. No longer squeeze into the same road, innovation and development, the road is long and difficult.
3. From the current point of view, domestic silicone will form the first echelon of several 400,000 tons/year enterprises within two years (Daowa Joint Venture, Xinghuo, Xin’an, Hesheng, Dongyue). Supply should be sufficient and competition fierce. Some companies are planning to exit after seeing this trend. Of course, there will also be resource enterprise plans to enter. But without a downstream foundation, the pressure faced by new entrants can be imagined. The supply of silicone will still fluctuate in stages, but the downstream layout is the foundation for the long-term development of each enterprise. But as mentioned before, the establishment of the downstream system is a long-term accumulation process.
erif; font-size: 14px;”> 2. The second supply-side reform is the improvement of reasonable profits based on innovation.But the development philosophy of Chinese entrepreneurs has not changed, especially in the traditional chemical industry. Environmental protection and safety supervision are both a means, but the fundamental thing is the change in the development concept of the entrepreneurial group. No longer squeeze the same road, innovative development, the road is long and difficult.
3. From the current point of view, domestic silicone will form the first echelon of several 400,000 tons/year enterprises within two years (Daowa Joint Venture, Xinghuo, Xin’an, Hesheng, Dongyue). Supply should be sufficient and competition fierce. Some companies are planning to exit after seeing this trend. Of course, there will also be resource enterprise plans to enter. But without a downstream foundation, the pressure faced by new entrants can be imagined. The supply of silicone will still fluctuate in stages, but the downstream layout is the foundation for the long-term development of each enterprise. But as mentioned before, the establishment of the downstream system is a long-term accumulation process.
