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The silicone industry chain is divided into four links: silicone raw materials, silicone monomers, silicone intermediates and silicone deep-processing products:
Organosilicon mainly refers to polysiloxane composed of silicon oxygen bond (- Si-O-Si -) as skeleton, accounting for more than 90% of the total dosage. Its raw materials are silicon powder and methyl chloride, and silicon powder is prepared by grinding metal silicon.
Methylchlorosilane is an important silicone monomer, accounting for more than 90% of the total. It is the foundation and pillar of the whole silicone industry. Thousands of silicone products can be produced from several basic monomers.
The utilization rate of China's silicone production capacity has been gradually improved and the production capacity has been continuously expanded:
According to Zhuo Chuang information, China's silicone monomer production capacity has been in a stage of moderate expansion in the past few years. From 2019 to 2020, with the new production capacity put into operation, the production capacity has been expanding.
With the technological progress of China's industry and the improvement of enterprise process management level, the overall capacity utilization rate of silicone has increased significantly from 42.31% in 2010 to 82.92% in 2019. It is expected that the capacity utilization rate will be further improved in the future. Silicone is a technology and resource intensive industry, and the concentration is further closer to the leader:
There are high barriers to entry in the production of silicone monomers. There are factors such as complex process, long production process and large equipment investment. The development of the whole industry tends to concentrate on enterprises with scale, technology, cost and product advantages.
Organic silicon is highly dependent on upstream raw materials. The production of industrial silicon consumes a lot of silicon ore and energy, and has great environmental pollution. The newly-built methyl chlorosilane monomer production unit with an initial scale of less than 200000 t / A and a single scale of less than 100000 t / a belongs to the "restricted category", and the high industry access threshold is expected to promote the rapid increase of industry concentration.
With the gradual improvement of supply and demand, the profits of downstream enterprises may usher in a turnaround:
According to the calculation of per capita consumption, China's per capita consumption of silicone is less than 1.0kg/person, which is more than double the growth space compared with 1.0-2.0kg/person in developed countries. The long-term demand increment of silicone in the future mainly comes from China.
Benefiting from the global economic recovery, the demand will grow rapidly, the overseas demand will recover rapidly, and the export of silicone market will gradually increase. In the future, the new production capacity is expected to be rapidly absorbed by the rapidly growing demand, and the profits of downstream enterprises may usher in a turnaround. We suggest paying attention to Zhejiang Xinan Chemical Indusyrial Group Co.Ltd(600596) , Hoshine Silicon Industry Co.Ltd(603260) , Shandong Dongyue Organosilicon Materials Co.Ltd(300821) .
Market review:
Sector performance: this week, CITIC's primary petroleum and petrochemical index rose or fell - 6.45%, ranking 27th among 30 industry indexes. This week, the Shanghai index rose or fell by - 4.00%, and the CITIC primary petroleum and petrochemical index was - 2.46% relative to the Shanghai index. The rise and fall of petroleum and petrochemical sub sectors: oil exploitation (- 4.77%), oil refining (- 5.18%), oil sales and storage (- 5.60%), engineering services (- 6.23%), other petrochemical (- 7.83%) and oilfield services (- 8.37%).
Rise and fall of individual stocks: this week, the petroleum and petrochemical sector led the rise of individual stocks, including Jiangsu Baoli International Investment Co.Ltd(300135) (+ 4.78%), Zhejiang Hailide New Material Co.Ltd(002206) (+ 0.29%), Suzhou Douson Drilling&Production Equipment Co.Ltd(603800) (+ 0.15%) and so on; Stocks leading the decline include Oriental Energy Co.Ltd(002221) (- 14.11%), Shanxi Blue Flame Holding Company Limited(000968) (- 13.43%), Bomesc Offshore Engineering Company Limited(603727) (- 12.22%), Hengyi Petrochemical Co.Ltd(000703) (- 11.55%), Tongkun Group Co.Ltd(601233) (- 11.22%), etc.
Risk warning: policy risk; Geopolitics exacerbates risks; The risk of sharp fluctuations in crude oil prices and the risk of continued deterioration of the global covid-19 epidemic;
