I. Core Raw Material Industrial Silicon Prices Fluctuated Upward, Strengthening Cost Support
Futures Market: On August 11, 2025, the main industrial silicon futures contract (2511) closed at 9,000 yuan/ton, up 415 yuan/ton, or 4.83%, from the previous day. The intraday high reached 9,025 yuan/ton, a recent high. The sharp rise in futures prices reflects market expectations of tightening supply in the future, boosting spot market sentiment.
Spot Market:
Tongxia 553# Silicon: Prices in East China are priced at 9,300-9,500 yuan/ton, while prices in Xinjiang are 8,600-8,800 yuan/ton, with widening regional price differentials.
421# Silicon: Prices in East China are priced at 9,600-9,900 yuan/ton, while prices in Kunming remain stable. High-grade silicon: Xinjiang 99 silicon prices are 8,600-8,800 yuan/ton. Market supply is tight, and some manufacturers are reluctant to sell.
Market Dynamics:
Supply: Silicon factories in Southwest China have reduced production due to rising electricity costs. Capacity release in Xinjiang is limited, and overall operating rates remain low.
Demand: Purchasing demand in the silicone and aluminum alloy industries remains stable, but increased speculative demand in the futures market is driving prices upward.
Inventory: The total number of futures warehouse receipts is 50,760 lots, an increase of 420 lots from the previous day, indicating strong bullish market sentiment for the future.

II. Organic silicon DMC prices diverge, and regional market competition intensifies.
East China Market:
On August 14th, the mainstream quoted price was 11,300-11,500 yuan/ton. Shandong single-factories lowered their offer to 11,300 yuan/ton, with other manufacturers also reducing their prices.
Market transactions were primarily driven by demand, with low trading volume in the high price range (above 11,500 yuan/ton). Single-factories negotiated discounts on orders to reduce inventory. Western Market:
On August 15th, the mainstream quoted price was 11,500-11,800 yuan/ton, slightly higher than in East China, but transaction resistance at high levels has increased.
Some monomer plants were negotiating weakly, and market sentiment was prevalent, with downstream purchases primarily consisting of small orders.
Shandong Market:
On August 16th, Shandong Dongyue Chemical and Luxi Chemical offered first-grade DMC at 13,000 yuan/ton, while domestic first-grade DMC was offered at 13,500 yuan/ton, significantly higher than in other regions.
The firm price in Shandong is primarily supported by local supply constraints, but the price gap with East China and Western markets has widened, revealing cross-regional arbitrage opportunities.

Market Dynamics:
Supply Side: Domestic organosilicon monomer plant operating rates remain high, but end-user demand is weak, and inventory pressures are gradually emerging.
Demand Side: The silicone rubber and silicone oil industries are cautious in purchasing, with some companies working through previous inventory and insufficient new orders.
Cost Side: Rising industrial silicon prices are driving up production costs, but DMC prices are struggling to rise in tandem due to demand, compressing monomer plant profit margins.

III. Downstream Product Price Divergence, Weak Consumption Constrains the Market
Organosilicon Defoamers:
On August 17, prices for conventional products in Henan Province ranged from 2,200 to 7,550 yuan/ton, while prices for high-concentration products reached 9,000 to 16,000 yuan/ton.
This price difference is primarily influenced by the active ingredient content, with products with a content of 60% or more significantly priced higher than conventional products.
Market Dynamics:
Defoamer market prices fluctuated minimally, but growing demand for high-end products prompted some manufacturers to raise their prices.
End-use industries (such as coatings, papermaking, and textiles) operated at low capacity, limiting incremental demand for defoamers.
Overall Consumption:
End-use silicone consumption primarily focused on silicone rubber, silicone oil, and silicone resin, but weak demand in sectors such as real estate and automobiles dragged down overall consumption growth.
Export markets, impacted by high overseas inventories, saw a decrease in new orders, weakening support for the domestic market.

IV. Market Outlook: Prices May Remain Volatile Due to the Conflict Between Cost and Demand
Short-Term (1-2 Weeks):
Industrial silicon futures prices have risen sharply, but the spot market has only partially followed suit, and there is a time lag in cost transmission.
The organosilicon DMC market is well supplied, but end-user demand is weak, creating significant upward resistance to prices.
DMC prices are expected to remain volatile in the short term, with the mainstream price range in East China being 11,300-11,800 yuan/ton.
Medium-Term (1-2 Months):
If industrial silicon spot prices continue to rise, DMC production costs will further increase, potentially driving prices slightly higher.
However, any improvement in end-user consumption will require confirmation during the traditional peak season of September and October, and the strength of demand-side support remains uncertain.
We recommend monitoring changes in industrial silicon supply and the pace of recovery in organosilicon end-user consumption to seize trading opportunities.