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Importance of strategically purchasing chemical raw materials

Writer:adminSource: Date:2018-07-14

After the trade war, the White House will announce the final list of Chinese products which are levied 25% tariffs, 50 billion U.S. dollars on June 15. The White House issued a statement on IPR protection measures for China, announcing investment restrictions and export controls before June 30. With the negative effects of the external market which led to the reshuffling of broader market, and the widespread downturn of the broader market, where should the market go? Will the price of silicone and chemical raw materials continue to rise? For professionels, this will be our most concerned topic for the next few months and even throughout the year. 


Another news is that China has enacted environmental policy. With the convening of the environmental conference from May 18 to 19th, the National Ecological Environmental Protection Conference is held in Beijing as well. President Xi pointed out that green development should be fully promoted. Green development is the inevitable requirement of constructing high quality modernized economic system, and is the basic policy to solve the pollution problem. People should focus on restructuring the economic structure and energy structure, optimizing the layout of land space development, adjusting the regional industrial distribution and cultivating to expand energy-saving environmental protection industry, clean production industry, clean energy industry and to promote the overall conservation and cyclic utilization. At the same time, people should also advocate simple and moderate, green low-carbon lifestyle.


Facing the international impact on the economy and the tougher domestic environmental protection which is normalized a general trend, organic silicon and other chemical raw materials will undoubtedly be impacted. In this grim market, as a direct or indirect silicone users, is there no need to make strategic procurement and planning it? The editor would like to make the following statements:

1. If the White House really announced a 25% tariff list on June 15, our country is bound to impose tariffs on the United States in order to deal with the balance of trade. As a result, the price of consumption products will rise again and the increase will not be small.
2. Under the routine inspection of the Environmental law Enforcement department , the unqualified factory, workshop will be closed and will be ordered to make rectification. The price of chemical raw material is bound to rise when production is reduced, this is the law of economics.

Considering two points above, if silicone will be used for a long time and there is no way to replace it with other materials in the short term, it is necessary to take the current inventory and make preparations for nearly 3 to 6 months. Of course, you can continue to hold a wait-and-see attitude towards the market, but the consequence may be adverse that you will cost more to buy the same material, or even worse quality products. This is not only an advice of editor but also a rule of the market driven by !


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