By Wang Shen
The Dow Chemical Company will raise the prices of its primary products of organosilicon by 10 percent to remain a high-performance building business from July 15.
This is the second time it has implemented a price increase this month.
The Dow Chemical Company is driving innovations that extract value from the material, polymer, through chemical and biological science to help address many of the world's most challenging problems, and its market-driven portfolio delivers a broad range of technology-based products and solutions in high-growth sectors such as packaging, infrastructure, transportation and consumer care.
The main reasons that Dow has raised its prices are due to the pressure from the increasing costs of raw materials, environmental protection regulations and logistics.
The price increase in Dow's products will help to ease and stabilize the organosilicon market, especially the downstream market. In the short run, the prices of its organosilicon products, which will remain high and the industry will outperform the expectations.
The products of the downstream organosilicon market include silicone oil, rubber, resin and coupling agent, which are widely used in construction, automobile, textile, electronics, electric power and so forth.
The production of organosilicon monomer in China accounts for 70 percent of the global output. From 2009 to 2010, China experienced an expansion in the production of organosilicon. After that, the industry has experienced overcapacity for six consecutive years, and the domestic demand has been relatively low. The price had been declining continuously in recent years, which caused many companies to gain minimal profit, or even suffer a loss.
In September 2016, the organosilicon industry completed a reshuffle and started to recover. By the end of 2017, there were a total of 15 organosilicon monomer companies in China, with an effective production capacity of approximately 2.7 million tons and an output of 1.97 million tons, representing a growth rate of 7.1 percent.
In the first quarter of 2018, the total Chinese exports of organosilicon amounted to 63,500 tons, with a year-on-year growth rate of 59.1 percent. At present, the stock level of downstream manufacturers is relatively low, and the price of downstream products is expected to rise continually.
