Entering mid-September, the silicone market continues its upward trajectory. Driven by both persistently strengthening methanol prices on the cost side and coordinated industry production cuts, silicone monomer producers have raised quotations for two consecutive days, pushing the market center of gravity further upward.

Cost Side: Tightening Methanol Supply Creates Transmission Pressure

The direct driver behind this round of price increases comes from the cost side. According to reports from Futures Daily, due to operational difficulties at facilities in the Middle East, approximately 62% of methanol plants in the region remain shut down. The navigation crisis in the Strait of Hormuz has led to a phased tightening of China's methanol imports, with methanol inventories at major coastal ports plunging by more than 55% year-on-year. As a critical raw material for the silicone industrial chain, methanol price increases exert direct transmission pressure on monomer production costs.

Supply Side: Coordinated Production Cuts Persist, Operating Rates Remain Low

On the supply side, the Hebei industry meeting on September 2 confirmed that the 50% emission-reduction target for September would remain at the same level as August, with the industry's overall operating rate maintained at a low level of around 60%. According to data from the Silicon Industry Branch, the comprehensive operating rate of the silicone industry stands at 62.9%, with enterprises showing a strong willingness to hold prices firm recently amid rising costs. In terms of price performance, after monomer plant quotations rose broadly on September 9, they were raised again on September 10. Current mainstream monomer plant DMC quotations stand at 14,700–14,900 RMB/ton, with raw rubber at 15,700–16,000 RMB/ton.

Market Signal: Clear Upward Trend Established

The silicone DMC trend analysis released by SunSirs on September 11 shows that the changes in the 5-day, 10-day, and 20-day moving average differences from the previous day were completely consistent in direction and all positive, meeting the clear upward trend criteria under the moving average difference method, with the price trend identified as a definitive uptrend. According to Mysteel data, DMC quotations in East China stood at 14,200 RMB/ton on September 8, up 200 RMB/ton from the previous day; raw rubber quotations stood at 15,000 RMB/ton, also up 200 RMB/ton.

Downstream Follow-Through and Risk Alerts

On the demand side, downstream users' apprehension toward continuously rising raw material prices has increased somewhat, making actual order follow-through a key short-term variable. SunSirs analysis also noted that the one-year cycle price for silicone DMC is already at a high level, corresponding to the fifth tier out of five, indicating limited room for further upside. This means that while cost pressures and supply contraction support prices, the degree of downstream acceptance and the level of actual transaction volume will determine the sustainability of this market rally.

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