Silica market analysis 1. Cost changes. According to the data of the channels of sulfuric acid and caustic soda (liusuan.100ppi.com, naoh.100ppi.com) of the business society, in the first half of the year, although the domestic prices of caustic soda and sulfuric acid experienced a short-term trough, they rose sharply as a whole. Tax included), to 687 yuan/ton (tax included) at the end of June, while caustic soda was from 614 yuan/ton (tax included) at the beginning of the year to 678 yuan/ton at the end of June. (tax included); in the second half of the year, the price of caustic soda It has soared again, reaching as high as 817 yuan / ton (tax included) at the end of the year, and although the sulfuric acid has declined, the high price continued until the end of October. In summer, when electricity consumption peaks, some provinces and regions adopt power curtailment policies, and some enterprises are inevitably affected. Tight coal supply and rising natural gas prices have increased the production cost of silica.

2. Changes in market supply. In the first half of the year, many domestic manufacturers have successively expanded production capacity and increased production lines. The operating rate is basically above 80%, and the supply is increasing. Since the country implemented the monetary tightening policy, domestic downstream enterprises reserve more cash flow in order to reduce expenditure and collect more cash as needed, with a wait-and-see attitude. At the same time, the appreciation of RMB has had a certain impact on my country's imported products, but it has also stimulated the growth of the export volume of fumed silica. In the second half of the year, some newly-built factories were put into operation one after another, and the oversupply became increasingly severe.

3. Changes in market demand. Spring and autumn are the peak seasons for pesticides, and summer is the peak season for rubber. In the summer of this year, there was a peak in electricity consumption, some areas implemented power curtailment, some small and medium-sized enterprises were closed for rest, and the demand for silica was greatly reduced. Moreover, tire companies generally have low start-up and sluggish demand. For the downstream merchants of silica, such as the paint industry, although the demand in the ink industry is not divided into peak seasons, the purchasing power continues to be weak, and most merchants take a wait-and-see attitude. In addition, affected by the weather, the downstream rubber and plastic products were unsalable, which also led to the sluggish demand for silica.