The supply side, surplus relief, competition structure optimization

At present, silicone monomer effective production capacity of about 2 million 500 thousand tons / year, output of about 1 million 800 thousand tons, the operating rate has increased to more than 70%, the future of the new productivity growth slowed sharply, demand will still maintain a growth rate of about 5%, the industry operating rate will continue to improve. At the same time, tighter environmental protection is a big trend, especially in the central part of the ongoing environmental inspectors, shutting down the device will be normalized. The competition in the industry structure optimization, four companies of the industry concentration is close to 50%, capable of producing silicone intermediate enterprises only 13, the price war is expected to end.

The demand side, demand for real estate has channeled, will continue

Silicone downstream about 23% of the demand comes from real estate, real estate is mainly used for decoration, with new and second-hand housing are closely related. In the first half of 16, the real estate industry ushered in a wave of construction peak, rising demand has gradually transferred to the silicone industry. Although the purchase of the policy tightening, but in view of new construction brought the demand lag and still high volume of second-hand housing transactions, we believe that real estate demand will continue to bring more than half the time. And the export quantity of demand also increased slightly.