On March 3, Dow Chemical announced it would raise product prices, with the latest round of adjustments expected to range between 5% and 15%.

Earlier on February 28, the Ningbo High-Quality Development Conference for the Organic Silicon Industry concluded in Zhejiang. Amid strong expectations of tightening supply, the conference unanimously approved a new product guidance price with a 5-percentage-point increase in the overall industry emission reduction ratio. This marks the first time the industry has explicitly set a price floor through a moderate upward adjustment following tentative price hikes of CNY200-300 per ton by major manufacturers after the Spring Festival. This adjustment sets the tone for the upcoming traditional peak season: “supply contraction and price recovery.” March, a peak production month for traditional downstream sectors like coatings, textiles, and new energy, is expected to see restocking demand resonate with the current supply tightening. Benchmark prices for key silicone products uniformly increased by CNY300. Specifically, the mainstream execution price for DMC (dimethyl siloxane) rose to 14,300 RMB/ton (net water), 107 rubber to 14,800 RMB/ton (net water), and 110 raw rubber to 15,100 RMB/ton.

Starting in March, each monomer plant must achieve a monthly production cut of no less than 30%. This means even companies that fell short of their January-February reduction targets must make up for the shortfall in March and subsequent months by intensifying shutdown maintenance or extending production curtailment periods. This ensures a substantial overall supply contraction by the end of the first quarter.

March marks the traditional peak season for production resumption in downstream sectors like coatings, textiles, and new energy, where restocking demand is expected to amplify the impact of this supply contraction. If the 35% production cut target is strictly enforced from March to May, DMC prices could stabilize at a new level in the second quarter. This price adjustment not only reflects cost pass-through but also signals a decisive shift in the industry from “low-price competition” to “value-based competition.”

Overseas silicone producers face multiple constraints including environmental regulations and rising costs, leading to capacity reductions. Dow's planned closure of its Barry, UK, base siloxane plant by mid-2026 signals a 145,000-ton/year reduction in European capacity, cutting local supply by nearly one-third.

From a policy perspective, while the elimination of export tax rebates for primary polysiloxanes effective April 1 may impose short-term cost pressures, it also compels the industry to shift from subsidy dependence toward pricing power, accelerating the elimination of outdated capacity. As the industry landscape optimizes and new downstream applications continue to expand, China's organosilicon sector is gaining renewed vitality.

As an integrated internet platform providing benchmark prices, on March 4, SunSirs' benchmark price for  DMC was RMB 14,000.00/ton, an increase of 1.08% compared to the beginning of the month (RMB 13,850.00/ton).

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