Silicone Industry Trends: Project Advancement and Output Changes

1.The construction of the new project is advancing steadily
Recently, the silicone industry has witnessed significant project progress. On April 10th, in the Wucaiwan Industrial Park of Xinjiang Zhundong Economic and Technological Development Zone, the construction work of Qiya Group's 1.6 million tons of organosilicon project per year was fully launched. The project is expected to be completed and put into operation by the end of 2026, and it is a key plan for its sub-group to improve the all-silicon-based industrial chain. The project will integrate advanced production techniques both at home and abroad, and build large-scale synthesis, distillation, hydrolysis and other facilities to provide raw material conversion support for large-scale production of organosilicon.

Qiya Group has a well-developed layout in raw materials. As early as the beginning of 2024, it planned a quartz mine project worth tens of millions of tons to provide raw materials for industrial silicon, polycrystalline silicon and organosilicon. Meanwhile, after the planned and constructed methanol project with an annual output of 6 million tons in 2024 is put into operation, it will also directly supply the organosilicon project. In addition, the hydrochloric acid produced by the group's existing 100,000-ton polysilicon chlor-alkali workshop per year, as well as the steam from its own nearly 4,000-megawatt thermal power generation units and the 3 million kilowatt wind-solar integrated project, will all provide sufficient auxiliary materials and energy support for the production of organosilicon.

2. The expansion project boosts market supply
On the morning of March 20th, the completion ceremony of Dow's silicone expansion project in Zhangjiagang Free Trade Zone was held. As a global leader in the silicone sector, Dow has been continuously investing since it settled in Zhangjiagang in 1998. The expansion project, which started in June 2023, aims to serve markets such as electronics, transportation, and renewable energy. The commissioning of the project will enhance Dow's supply capacity in the Asia-Pacific region and also inject new impetus into Zhangjiagang's advanced materials industry.

3. There are fluctuations in the industry's output
On April 18th, it was reported that the average weekly capacity utilization rate of a single unit of 13 sample domestic silicone DMC enterprises this week was approximately 60.43%, a decrease of 1.06% compared to last week, with a cycle output of about 40,300 tons. The changes in the operating rate and output of silicone DMC reflect the current production situation of the industry, which may be influenced by various factors such as market demand and raw material supply.

With the advancement of new projects such as its sub-group and the completion of Dow's expansion project, the future production capacity of the silicone industry is expected to increase, and the market supply pattern may change. In the short term, fluctuations in output will continue to draw attention from the industry, and the subsequent development trend of the industry is worth further tracking and observation.