Group 1 - The A-share silicon-based materials sector experienced a pullback during trading, with significant declines in several companies [1] - Hongbai New Materials hit the daily limit down, indicating a strong negative market reaction [1] - Other companies such as Feilu Co., Jitai Co., Chenguang New Materials, and Jihua Group also saw declines, following the trend set by Hongbai New Materials [1]

Core Viewpoint - The A-share market shows mixed performance with over 3100 stocks rising, while specific sectors like organic silicon and coal stocks demonstrate notable strength, contrasting with declines in real estate and certain financial sectors [1][2][3]. Sector Summaries Organic Silicon Sector - The organic silicon concept saw a significant afternoon rally, with Morning Light New Materials (晨光新材, 605399) hitting the daily limit and achieving a cumulative increase of over 33% in the last three trading days [6][9]. - Other companies in this sector, such as Morning Chemical (晨化股份) and Hongbai New Materials (宏柏新材), also experienced gains exceeding 6% [6]. - The demand for organic silicon products in China remains strong, driven by growth in electronics, new energy vehicles, and photovoltaic sectors, with expectations for continued demand increase [9][10]. Coal Sector - Coal stocks experienced a short-term surge, with Zhengzhou Coal Electricity (郑州煤电) reaching the daily limit and closing up by 5% [12][14]. - The electricity load in China hit a historical high, with a peak of 1.465 billion kilowatts, indicating a tight power supply and increased coal consumption expectations during the summer [15]. - Analysts predict that coal prices will maintain upward momentum due to high power plant coal consumption and low inventory levels [15][16]. Market Performance - The Shanghai Composite Index rose by 0.27%, while the Shenzhen Component and the ChiNext Index fell by 0.11% and 0.45%, respectively, indicating a mixed market sentiment [3].

Group 1 - The organic silicon concept increased by 1.64%, ranking 6th among concept sectors, with 31 stocks rising, including Morning Light New Materials which hit the daily limit, and others like Morning Chemical, Hongbo New Materials, and Heyuan Gas showing significant gains of 6.82%, 6.74%, and 5.94% respectively [1] - The organic silicon sector experienced a net outflow of 169 million yuan in main funds today, with 19 stocks receiving net inflows, led by Hesheng Silicon Industry with a net inflow of 40.92 million yuan [2][3] - In terms of fund inflow ratios, Demai Chemical, Xiangyuan New Materials, and Feilu Co. had the highest net inflow ratios at 8.96%, 7.83%, and 6.85% respectively [3] Group 2 - The top stocks in the organic silicon concept by net inflow include Hesheng Silicon Industry, Huaitian New Materials, and Fuxiang Pharmaceuticals, with respective net inflows of 40.92 million yuan, 30.94 million yuan, and 15.94 million yuan [3] - Stocks with significant declines include ST Hongda, Jin Yinhe, and Huasheng Lithium Battery, which fell by 1.69%, 0.96%, and 0.90% respectively [1][5] - Morning Light New Materials and Hongbo New Materials showed notable increases of 9.97% and 6.74%, respectively, despite the overall sector experiencing some outflows [5]

Group 1 - The core viewpoint of the article highlights the significant movement in the organic silicon sector, particularly the surge in stock prices of companies like Morning Light New Materials, which achieved a three-day consecutive limit-up [1] - The announcement from Dow regarding the closure of its siloxane facility in the UK due to cost pressures in Europe is a critical factor influencing the market [1] - The closure is expected to begin in mid-2026 and be completed by the end of 2027, affecting a production capacity of 145,000 tons of DMC, which represents 3% of global capacity and 13.7% of overseas capacity [1] Group 2 - Other companies in the organic silicon sector, such as Morning Chemical, Hongbo New Materials, Silica Treasure Technology, Runhe Materials, and Dongyue Silicon Materials, also experienced price increases following the news [1] - The market reaction indicates a potential shift in supply dynamics within the organic silicon industry due to the impending closure of Dow's facility [1]

Group 1 - The organic silicon sector experienced a short-term surge, with Morning Light New Materials (605399) hitting the daily limit up [1] - Other companies in the sector, such as Silicon Treasure Technology (300019), Huitian New Materials (300041), Runhe Materials (300727), Jianghan New Materials (603281), and Jitai Co., Ltd. (002909), also saw significant increases in their stock prices [1]

Summary of Key Points from Conference Call Records Industry Overview Chemical Industry - **Chlorinated Sugar Market**: The price of chlorinated sugar is expected to rise significantly as it is currently at a historical low. Manufacturers are pushing for price increases, with a potential profit increase of approximately 200 million yuan if the price rises by 10,000 yuan per ton for the 23,000 tons of capacity [1][2]. - **Chlorinated Sugar Supply and Demand**: The industry is projected to start collaborative efforts to counteract internal competition in 2024. Currently, there is an excess capacity of about 7,000 tons, but with a natural annual growth of 2,000 tons, supply-demand balance is expected to improve by 2026 [1][3][4]. Organic Silicon Market - **Market Conditions**: The organic silicon market has experienced a three-year bottom cycle, with supply-demand relationships improving. Demand is growing at an annual rate of approximately 15%, despite a decline in the construction sector [5]. - **Supply Adjustments**: The supply side has seen excessive investment in recent years, leading to a decrease in operating rates. Future adjustments in supply are critical to align with stable demand [5][8]. - **Foreign Investment Exit**: Foreign companies are actively exiting the organic silicon market, which may lead to significant changes in the supply side and create new opportunities for domestic companies [6][7]. Company-Specific Insights Jiurui New Materials - **Chlorinated Sugar Production**: Jiurui New Materials has a production capacity of 23,000 tons. A price increase of 10,000 yuan per ton could yield an additional profit of about 200 million yuan, indicating significant profit elasticity [2][3]. - **Strategic Plans**: The company is considering mergers and acquisitions to optimize pricing and enhance technology in response to industry competition [13][14]. Sanli Sugar - **Market Response**: Sanli Sugar's price increase has not been reflected in its stock price due to severe overcapacity. The company is attempting to reduce production to elevate prices, with market reactions to be observed in the upcoming quarters [15][16]. Jinhe Company - **Profit Potential**: Jinhe Company stands to benefit from price increases in chlorinated sugar, with potential profit increases of 70-80 million yuan for every 10,000 yuan price rise [4][16]. Additional Considerations - **Market Dynamics**: The organic silicon market is expected to reach a balance between supply and demand by the end of 2024, with no new large-scale expansions planned, which may stabilize prices and profitability [8][11][12]. - **Impact of External Factors**: The closure of Dow's peroxide plant in the UK has reduced European capacity by approximately 140,000 to 150,000 tons, positively impacting global supply optimization [7]. This summary encapsulates the key insights and projections from the conference call, highlighting the dynamics within the chemical and organic silicon industries, as well as specific company strategies and market conditions.

Core Viewpoint - Dow Chemical plans to close its organic silicon plant in the UK, impacting approximately 145,000 tons/year of siloxane capacity, which accounts for about 30.5% of Europe's total siloxane capacity as of 2024. This closure is attributed to high energy costs, stricter environmental regulations, and intensified global competition in the organic silicon industry [2]. Group 1: Dow Chemical's Plant Closures - Dow Chemical announced the closure of its ethylene cracking facility in Germany and its organic silicon plant in the UK, with the UK plant expected to close by mid-2026 [2]. - The closure of the UK organic silicon plant will significantly reduce the supply of organic silicon in Europe, potentially alleviating downward price pressure caused by global overcapacity [2]. Group 2: Policy Impacts on Organic Silicon Demand - Recent favorable policies in the photovoltaic and real estate sectors are expected to boost demand for organic silicon products. The Central Financial Committee emphasized the need to regulate low-price competition and improve product quality [3]. - The push for new urbanization and the recovery of the photovoltaic and construction industries are anticipated to enhance the overall demand for organic silicon, leading to improved industry conditions [3]. Group 3: Supply and Demand Dynamics - As of June 2025, domestic organic silicon DMC capacity is projected to remain at 3.44 million tons/year, with no new capacity expected in 2025. Although 1.85 million tons/year of capacity is planned for 2026-2027, delays are anticipated due to financial pressures on companies [4]. - The apparent consumption of organic silicon DMC in China from January to May 2025 reached 838,000 tons, reflecting a year-on-year growth of approximately 25%, indicating a steady increase in demand despite supply constraints [4].

Core Viewpoint - The article discusses the performance predictions for various industries in the upcoming mid-year reports, highlighting sectors that may show strong growth or improvement in performance [4]. Industry Performance Predictions - The manufacturing sector is expected to have the highest growth rate in performance, while the TMT (Technology, Media, and Telecommunications) sector may show the most significant improvement [4]. - Industries such as light industry, non-ferrous metals, and non-bank financials are predicted to have higher growth rates in their mid-year performance reports [4]. - Conversely, industries like construction materials, electronics, and telecommunications are anticipated to show substantial improvement in performance metrics [4]. Market Trends - The convertible bond market has seen a continuous increase for three weeks, with the China Convertible Bond Index rising by 0.8% in the last week, outperforming the equity market [5]. - The copper market is facing potential supply pressure due to a recent announcement of a 50% tariff on copper imports by the U.S., which may affect global copper inventory flows [6]. - Oil prices have rebounded due to seasonal demand increases and anticipated supply constraints from OPEC+, with Brent and WTI crude oil prices rising by 3.1% and 3.4% respectively [8]. Specific Industry Insights - Dow Chemical's decision to close its organic silicon plant in the UK is expected to reduce supply in Europe, potentially alleviating price pressures in the organic silicon market and benefiting high-quality exports from Chinese companies [8]. - The pork market is experiencing a decline in prices due to weak demand and increased storage costs, with the average price of live pigs dropping by 3.52% week-on-week [9]. - China State Construction's high dividend yield is becoming competitive compared to banks, with a stable dividend policy and a strong order book growth despite the low-interest-rate environment [10].

1. Report Industry Investment Rating - Industrial silicon: Oscillation; Polysilicon: Oscillation [1] 2. Core Viewpoints of the Report - The production plan of large factories in Xinjiang will have a significant impact on the fundamentals of industrial silicon. The failure of large factories in Xinjiang to resume production as expected has led to a marginal improvement in the fundamentals of industrial silicon. For polysilicon, in response to the government's "anti - involution" policy, polysilicon enterprises have raised their offers, but the actual transactions are yet to be seen. The price increase of polysilicon depends on the implementation of production cuts and the price increase of downstream products [2][3] - For industrial silicon, it is recommended to pay attention to the short - selling opportunities on rebounds and wait for right - hand signals. For polysilicon, although it is generally bullish, short - term callback risks should be noted, and attention can be paid to the 8 - 9 positive spread arbitrage opportunities [4][17] 3. Summary by Relevant Catalogs 3.1 Industrial Silicon/Polysilicon Industry Chain Prices - This week, the Si2509 contract of industrial silicon increased by 435 yuan/ton to 8415 yuan/ton. The SMM spot price of East China oxygen - blowing 553 increased by 100 yuan/ton to 8850 yuan/ton, and the price of Xinjiang 99 increased by 250 yuan/ton to 8300 yuan/ton. The PS2508 contract of polysilicon increased by 5820 yuan/ton to 41330 yuan/ton. According to the Silicon Industry Association, the transaction price of N - type re - feeding material this week increased by 2400 yuan/ton to 37100 yuan/ton [10] 3.2 Xinjiang Large Factories' Resumption of Production Falling Short of Expectations, and Attention to the Implementation of PV Anti - Involution Industrial Silicon - This week, the main contract of industrial silicon futures rose significantly. The weekly output was 72,200 tons, a month - on - month increase of 0.31%. The SMM industrial silicon social inventory decreased by 0.1 million tons month - on - month, and the sample factory inventory decreased by 2.6 million tons month - on - month. If the large factory maintains 48 furnaces in operation, industrial silicon may have a monthly de - stocking of 60,000 tons. If it resumes full production at the eastern base, it may have a monthly inventory build - up of 30,000 tons. The market transaction price of 99 silicon powder rose to about 9000 - 9100 yuan/ton [12] Organic Silicon - This week, the price of organic silicon bottomed out and rebounded. The overall enterprise operating rate this week was 70.9%, the weekly output was 46,900 tons, a month - on - month increase of 0.64%, and the inventory was 48,800 tons, a month - on - month decrease of 1.41% [12][13] Polysilicon - This week, the main contract of polysilicon futures continued to rise sharply. The quoted price of N - type polysilicon re - feeding material ranges from 43 to 49 yuan/kg, but there are no actual transactions yet. It is expected that the polysilicon production schedule in July will increase to 110,000 tons, and it will enter a monthly inventory build - up state. As of July 10, the inventory of Chinese polysilicon factories was 276,000 tons, a month - on - month increase of 0.4 million tons [13] Silicon Wafers - This week, the quoted price of silicon wafers was significantly increased, but there were no market transactions yet. The production schedule in July is expected to be 52GW, a month - on - month decrease of more than 10%. As of July 10, the silicon wafer factory inventory was 18.13GW, a month - on - month decrease of 1.09GW [14] Battery Cells - This week, the quoted price of battery cells was significantly increased. The production schedule of battery cells in July is expected to be 54GW, still in an oversupply state. As of July 7, the inventory of Chinese photovoltaic battery export factories was 12.86GW, a month - on - month increase of 1.33GW [15] Components - This week, the component price was stalemate. The 7 - month component production schedule is expected to be 45GW. The difficulty in component price increase lies in its lag and the preferential issues in downstream actual procurement [16] 3.3 Investment Recommendations Industrial Silicon - It is recommended to pay attention to the short - selling opportunities on rebounds of industrial silicon. Observing right - hand signals such as large factories' resumption of production and warehouse receipt registration may be safer [17] Polysilicon - Generally, a bullish view is taken on polysilicon, but short - term callback risks should be noted. It is recommended to pay attention to the 8 - 9 positive spread arbitrage opportunities [17] 3.4 Hot News Collation - From the settlement on July 14, 2025, the daily price limit of polysilicon futures contracts will be adjusted to 9%, the speculative trading margin standard will be adjusted to 11%, and the hedging trading margin standard will be adjusted to 10% [18] - Hongyuan Green Energy intends to participate in the pre - reorganization of Wuxi Suntech. Its subsidiary will cooperate with Wuxi Suntech for production and operation management [18] - Runyang's Yunnan base resumed full - load production in 10 days, breaking the industry record [18]

Investment Rating - The industry rating is "Overweight" (maintained) [7] Core Viewpoints - Recent price increase of organic silicon intermediates is attributed to sufficient pre-sale orders and rising metal silicon prices [9][11] - The supply side is expected to see limited new capacity for organic silicon in China, while demand from electronics, new energy vehicles, and photovoltaics is anticipated to grow [30] - The closure of overseas production capacity, such as Dow's UK facility, is beneficial for China's organic silicon exports, improving the supply-demand balance [29][30] Summary by Sections Industry Overview - From July 7 to July 11, 2025, the basic chemical industry rose by 1.53%, ranking 19th among all Shenwan first-level industries [12] - The top five stocks by weekly increase in the basic chemical industry included: Shangwei New Materials, Hongbo New Materials, Chenguang New Materials, *ST Yatai, and Dongyue Silicon Materials [12] Sub-industry - Organic Silicon - As of July 11, 2025, the price of organic silicon intermediate DMC was 11,000 RMB/ton, up 1.9% from the previous week [11][14] - The industry is experiencing a decrease in inventory and a strong willingness to maintain prices, although downstream demand has not significantly increased [14] - The recent rise in metal silicon prices is providing cost support for organic silicon prices [14] Investment Recommendations - The organic silicon industry is expected to see an improvement in supply-demand dynamics, with a potential recovery in industry prosperity [30]