- Global silicone oil prices remained largely stable in Q1 2026, with marginal movement as opposing forces of weak upstream silicon markets and rising cost pressures balanced each other.
- Feedstock conditions stayed mixed, with silicon metal and polysilicon prices under pressure, while geopolitical tensions, including the Iran war and disruptions in the Strait of Hormuz, increased energy, raw material, and logistics costs.
- Downstream demand remained steady, supported by sectors such as cosmetics, automotive, and industrial applications, though purchasing was cautious amid cost volatility.
Silicone oil prices in China were about RMB 20.09/kg (FOB) in January and around RMB 20.08/kg in March, reflecting a marginal 0.03% decline over the period. In January, prices remained supported by stable downstream demand and firm cost structures, while feedstock conditions were relatively balanced. Post-Spring Festival, the market faced pressure as silicon metal and polysilicon prices weakened, reflecting softer upstream sentiment and limiting upward movement.
However, into March, cost-side pressures intensified despite weak upstream pricing, driven by geopolitical disruptions. The Iran war and logistical constraints in the Strait of Hormuz increased freight costs, insurance premiums, and energy-linked expenses, tightening supply chains and offsetting downward pressure. Major producers responded to rising costs, with companies such as SILIBASE shifting to dynamic pricing due to higher logistics surcharges and raw material volatility.
At the same time, global producers raised silicone prices amid supply chain disruptions, reflecting cost escalation across the value chain. Demand remained steady but cautious, with downstream industries adjusting procurement strategies in response to price uncertainty.