The organic silicon industry has recovered since the third quarter of 2016. The industry supply structure has continued to improve. Domestic and international demand is relatively strong. The industry's production capacity growth rate is much lower than the demand growth rate. The profitability of the industry and major listed companies continues to improve. The domestic supply structure continued to be optimized, environmental protection standards increased the superimposed policy restrictions, and backward production capacity gradually withdrew. At the same time, there was no new capacity in the industry in 2016 and 2017.




In 2017, there were 15 domestic silicone monomer enterprises (including Zhangjiagang Road Corning), with a total monomer production capacity of 2.785 million tons/year. In 2017, the total output of organic silicon monomer was 2.1 million tons, up 14% year-on-year; The two largest single companies are Dow Corning (Zhangjiagang) Silicone Co., Ltd. and Bluestar Jiangxi Xinghuo Silicone Plant. The two companies have a combined capacity of about one-third of the total capacity of organic silicon monomers in the country. Two leading enterprises in the single industry.


In 2017, the net export was 93,000 tons (silicone), a record high. Overseas demand is strong. With the gradual maturity of domestic organosilicon process technology and continuous increase in production capacity, domestically imported organic silicon has shown a downward trend.


The main application areas of deep-processed silicone downstream products are construction and wire and cable, in which commercial real estate in the construction sector is warming up. With the development of national railways and rail transit, the overall demand for the wire and cable industry will increase. Industry earnings are expected to continue to improve. At present, the profitability of the organic-silicon industry, especially the upstream-intermediate-intermediate link, has greatly improved with the price increase of the product. Although the DMC price will not increase much compared with the historical high point in the future, the overall environmental protection pressure in 2018 In the case that the probability is continuous and the supply is difficult to release, the average annual price difference in 2018 is expected to continue to improve compared to 2017, and the industry's profitability continues to improve.






2 major achievements


2.1 China has become the largest raw material base for the world's organic silicon industry
 
In the production of silicone monomers, the metal silicon block exceeds more than half of the raw material cost. China began mass production of metal silicon in 1986. After more than 30 years of development, it has made great progress in quantity, variety, quality and cost control. Domestic metal silicon blocks are mainly concentrated in areas with abundant power resources such as Xinjiang, Yunnan, Sichuan, Hunan, etc. The main production enterprises are Hesheng Silicon Industry Co., Ltd., Yunnan Yongchang Silicon Industry Co., Ltd., Xinjiang Oriental Hope Nonferrous Metals Co., Ltd., etc. In 2017, China's metal silicon production capacity is about 4.6 million tons, and the output is about 2.3 million tons, accounting for two-thirds of the world's total output. After the elimination of export tariffs on metal silicon in 2013, the export volume of metal silicon increased significantly. From 2013 to 2016, the export volume was above 770,000 tons. In 2017, China exported 838,000 tons of metal silicon, and its export volume accounted for 36% of the current year's output. This makes the Chinese organic silicon industry have an important raw material advantage.