Recently, the organosilicon industry’s prosperity has continued to rise. Building on supply-demand optimization, technological breakthroughs, and explosive high-end demand, new dynamics such as the implementation of production cuts and improvement in leading companies’ performance highlight the resilience of the industry’s recovery.
On the supply-demand side, efforts to “reverse internal competition” have entered a substantive implementation stage. In November, Luxi Chemical and HOSHI Silicon successively led industry meetings, setting clear targets of “30% production cuts + price increases to 13,500 RMB/ton” and detailing supervision mechanisms. As of November 19, the price of the core product DMC rose to 13,200 RMB/ton, an increase of 20% compared with the end of October, while the industry’s average gross profit rose by 2,650 RMB/ton. Coupled with the completion of expansion cycles and policies phasing out small-scale capacity, signals of a bottom reversal in the supply-demand structure are becoming clear.
Leading companies’ operations have begun to recover first, and industry concentration continues to rise. HOSHI Silicon returned to profitability in Q3, with a net profit attributable to shareholders of 76 million RMB. Its 1.73 million ton/year organosilicon monomer capacity ranks first in the industry, and it also possesses core technologies across the full silicon carbide industry chain, achieving breakthroughs in high-end powders. Luxi Chemical’s 400,000-ton organosilicon project has been successfully commissioned, significantly expanding production capacity. Currently, the six major domestic leaders account for 62% of total capacity, laying the foundation for rational competition in the industry, with only Dongyue Silicon Materials temporarily affected due to a previous plant incident.
On the demand and policy side, favorable conditions continue to converge. High-end demand is surging in sectors such as new energy vehicles and photovoltaics. From January to September 2025, domestic apparent consumption increased 19.6% year-on-year, and the global market size is expected to exceed 280 billion RMB. Domestic substitution is accelerating: Silibao Technology’s high-purity encapsulation adhesive and HOSHI Silicon’s medical-grade silicone have successively broken import monopolies. Meanwhile, tightening global environmental regulations are driving the development of green processes, with more than 15 international standards updated within the year, signaling a shift in the industry from low-price competition to value-based competition.
