Analysis of the reasons for the recent sharp rise of silica gel raw materials!

Recently, silica gel raw materials have soared across the board, the price has increased by one-third, and the goods are out of stock. Especially this year, due to the impact of the epidemic at home and abroad, what led to the sharp rise in the price of silica gel raw materials? The main reasons for the recent sharp rise of silica gel raw materials are analyzed below.

Because the production cost of silicone by overseas enterprises is relatively high and belongs to hazardous chemicals, many foreign enterprises have withdrawn from China's market in recent years. The production capacity of Chinese enterprises has more room for growth. It is estimated that by 2024, China's silicone production capacity will reach 70.5% of the global proportion.

After the impact of the epidemic at the beginning of this year, the downstream industry of silicone gradually recovered and the product consumption accelerated. At the same time, the overseas Yi situation has led to the return of a large number of demand orders, and the demand in the domestic market is strong, which is in short supply. DMC prices have risen by more than 50% from the low at the end of July. More specifically, a few days ago, a silicone factory shut down due to a fire accident, resulting in a jump in silicone prices. On November 15, the price of organosilicon DMC in East China has reached 24000 yuan per meal. In the short term, there is still room for price rise due to the contradiction between supply and demand.

The main reason for the sharp rise of silica gel raw materials is the sharp rise in the prices of raw collagen materials and DMC. Raw rubber is the main raw material for the production of mixed silicone rubber, while DMC is the main raw material for the production of raw rubber. Once the price of DMC rises, it will lead to the overall price rise of our silicone industry. Because the price of DMC materials has risen sharply recently, which directly affects the price of raw rubber and silica gel raw materials.

So why did the price fluctuate little in the first half of the year and began to rise wildly in the second half of the year. This is mainly related to the foreign epidemic. In the first half of the year, due to the outbreak of the foreign epidemic, foreign trade exports fell sharply, resulting in the depression of the market economy. Therefore, the price of silica gel raw materials fluctuated little. Since the second half of the year, Chinese enterprises have returned to work and production for some time, and the output has basically returned to the normal level. Coupled with the second outbreak of foreign epidemic, many foreign orders have turned to domestic factories for production. Especially recently, the prices of the whole chemical industry are rising across the board, and DMC materials are also directly affected.

As an important organic compound, DMC material has important applications not only in the silicone industry. Because DMC is non-toxic, it can replace highly toxic phosgene, methyl chloroformate and dimethyl sulfate as methylation agent or carbonylation agent, improve the safety of production operation and reduce environmental pollution. As a solvent, DMC can replace freon, trichloroethane, trichloroethylene, benzene, xylene, etc. for paints, coatings, cleaning solvents, etc. As a gasoline additive, DMC can improve its octane number and oxygen content, and then improve its antiknock performance. In addition, DMC can also be used as an additive for detergent, surfactant and softener. Because of its wide range of applications, DMC is known as the "new cornerstone" of organic synthesis.

As DMC materials are widely used in all walks of life, once the demand of other industries increases, DMC materials will be in short supply, resulting in rising prices. In addition, in the first half of this year, the market demand was not strong, the material prices basically tended to low-cost operation, and DMC manufacturers and raw rubber manufacturers had a speculation mentality. With the help of the strong market demand and the secondary outbreak of the epidemic abroad, it contributed to the recent sharp rise of silica gel raw materials.

As the price of silica gel raw materials rises and falls regularly, if it rises sharply, it will maintain the rising momentum for a period of time and then fall back quickly. Therefore, it is expected that silica gel raw materials will still maintain the rising momentum in the near future. The downstream silica gel product factory should adjust the price in time according to its own production cost, otherwise the losses caused by the recent sharp rise of silica gel raw materials will outweigh the losses.