1、 The world's first 10000 ton bio based silicone rubber production line has been put into operation, ushering in a green new era for the organic silicon industry

In July 2025, a chemical enterprise in Shandong announced the official launch of the world's first 10000 ton bio based silicone rubber production line, marking the complete liberation of the silicone industry from dependence on petroleum raw materials and entering the era of "green reconstruction and technological fission" dual track competition. This production line adopts the rice husk to produce highly active silane technology developed by the Chinese Academy of Sciences. By replacing traditional petroleum based methanol with biomass raw materials, the cost approaches that of petroleum based routes, while reducing carbon emissions by more than 30%.


This breakthrough quickly triggered a chain reaction in the industry chain. Hesheng Silicon Industry collaborates with Brazilian sugarcane chemical giant to lay out sugarcane based methanol projects, aiming to break the curse of "methanol metal silicon" price linkage; Dongyue Group has upgraded its path through the chloromethane method, reducing the unit energy consumption of newly built single units to below the industry average of 20%, becoming a benchmark case in the Ministry of Industry and Information Technology's "15th Five Year Plan for High Quality Development of the New Materials Industry".


Industry analysts point out that the popularity of biobased materials will reshape the competitive landscape of organic silicon. According to the "High end Organosilicon Domestic Replacement Roadmap" by China Research and Development Corporation, the application of medical grade liquid silicone (LSR) in the field of insulin pumps has grown by 500%, while bio based technology is expected to break down barriers to medical device certification within five years and accelerate domestic substitution.


2、 Hubei chemical plant accident triggers safety warning, regional energy constraints restructure production capacity map
On September 9th, a large silicone enterprise in Hubei Province experienced an explosion accident, resulting in 5 deaths and 1 injury, and causing a sharp decrease in the supply of DMC (dimethyl siloxane mixture) in the local market. After the accident, DMC prices in East China jumped by 12% in a single day, and leading companies such as Hesheng Silicon Industry and Xin'an Shares urgently closed down, causing market panic to spread.


This accident exposed the weak links in industry safety production. According to the Ministry of Emergency Management, there were a total of 8 safety accidents in organic silicon enterprises nationwide in the first half of 2025, of which 62% were caused by leakage and explosion due to equipment aging. At the same time, due to power restrictions, industrial silicon production in Yunnan has decreased by 40%, triggering the industry's "most stringent cost transmission pressure test". Zhongyan Puhua's "Extreme Risk Simulation Report on Organic Silicon Industry Chain" warns that regional energy constraints will force the relocation of national production capacity to northwest regions with abundant hydropower, and Xinjiang, Inner Mongolia and other regions will accelerate their rise with low-cost advantages.


At the enterprise level, leading companies strengthen their risk resistance capabilities through vertical integration. The photovoltaic integrated industrial park constructed by Hesheng Silicon Industry in central Xinjiang covers a project of 200000 tons of high-purity polycrystalline silicon, 20GW photovoltaic modules, and 1.5 million tons of ultra-thin and highly transparent photovoltaic glass, forming a closed loop of the entire industry chain of "silicone rubber products". As of September 2025, the company's industrial silicon production capacity reached 1.22 million tons per year, and its organic silicon monomer production capacity was 1.73 million tons per year, ranking first in the world.


3、 The demand for new energy has exploded, and organic silicon materials have become the "heart of high-end materials"
Driven by the "dual carbon" goal, organic silicon materials are transitioning from traditional sealants to new energy core empowering materials. In the field of photovoltaics, the production capacity of encapsulation adhesive has increased by 300% in two years, and leading enterprises have built cost barriers by establishing their own metal silicon smelters; In the field of energy storage, silicon carbon negative electrode material projects have been intensively implemented, and the Wuxi Rich Lithium Ying New Energy project with an annual output of 1000 tons has passed the environmental impact assessment, which is expected to solve the energy density bottleneck of lithium-ion batteries; In the field of healthcare, biodegradable silicone rubber vascular stents have entered the clinical stage, giving rise to a billion dollar market for implant material replacement.


The technology iteration cycle has been shortened to 18 months, forcing companies to accelerate innovation. Wacker Chemicals mass produces NEXIPAL at its Zhangjiagang base ®  Sense stretchable sensor laminate material compresses the thickness of flexible printed electronic components to 50 microns; Zhongyan Puhua's "Organic Silicon+AI" Innovation Laboratory has incubated 17 patents, among which shape memory silicone rubber artificial muscles have been commercialized, and the demand for the robotics industry is growing exponentially.


At the policy level, the Ministry of Industry and Information Technology, in conjunction with the State Administration for Market Regulation, has issued the "Action Plan for Stable Growth of Electronic Information Manufacturing Industry from 2025 to 2026", which clearly requires the legal governance of low-priced competition in photovoltaic and other products, and promotes the industry's transformation towards high-end. According to data from Oriental Wealth, multiple stocks in the new energy and organic silicon sectors showed active performance on September 5th. Jin Yinhe (300619. SZ) hit the daily limit up, with a total market value exceeding 5.7 billion yuan. Its new energy equipment business orders increased by 200% year-on-year.


4、 Capital market volatility intensifies, industry valuation system restructuring
On the secondary market, organic silicon concept stocks are showing a trend of differentiation. As of the close of September 9th, the stock price of Hesheng Silicon Industry (603260. SH) has risen by 34% compared to the beginning of the year, while Xin'an Shares (600596. SH) is expected to see a 15% decrease in net profit for the third quarter due to power restrictions in Yunnan. In terms of capital flow, on September 5th, the main funds of the sector had a net inflow of 1.3 billion yuan, among which Tianci Materials (002709. SZ) and Runhe Materials (300727. SZ) received northbound capital inflows.


There are significant differences in institutional viewpoints. China International Capital Corporation (CICC) believes that with the popularization of bio based technology and accelerated import substitution of high-end products, the industry's average gross profit margin is expected to increase from the current 22% to 28% by 2026; However, CITIC Securities warns that black swan events such as power rationing in Yunnan and accidents in Hubei may trigger short-term valuation corrections, and recommends focusing on leading enterprises with advantages in industrial chain integration.


It is worth noting that ESG investment concepts are reshaping the valuation logic of the industry. Hesheng Silicon Industry has received an MSCI ESG rating upgrade due to its self owned power plant and circular economy model; And a small and medium-sized silicon enterprise was removed from the list of social security fund holdings due to environmental non-compliance, highlighting the urgency of green transformation.


5、 The technology forum focuses on "silicon-based new energy" and cross-border integration has become a new trend
On September 18th, 2025, the 3rd Organic Silicon Technology and Application Innovation Forum will be held in Shanghai. Enterprises and research institutions such as ZTE, Wuhan University, and Chengdu Silicon Treasure Technology will showcase their latest achievements. The topics covered include:


Silicon based thermal conductive material: ZTE Corporation will release high thermal conductivity silicone pads for wireless base stations, with a thermal conductivity coefficient exceeding 8W/m · K;
Medical grade silicone rubber: The antibacterial silicone catheter developed by the Zhejiang University team has an inhibition rate of 99.9% against Staphylococcus aureus;
Silicon carbon negative electrode technology: The silicon oxygen carbon composite material showcased by Suzhou Qitian New Materials has increased the first charge and discharge efficiency to 92%;
Circular economy model: Guangzhou piloted the "exchange of old silicone rubber for new" system, and the performance of recycled silicone rubber reached 95% of the original raw material.
During the forum, State Grid Corporation of China will hold a special discussion on the development of long-life composite insulators to promote the application of organic silicon materials in the field of ultra-high voltage transmission. Experts in attendance predict that by 2028, the market size of silicon-based materials in the three major fields of new energy, healthcare, and electronics will exceed 500 billion yuan, with a compound annual growth rate of 19%.


Conclusion: Green and intelligent dual wheel drive, silicone opens a new era
Standing at the starting point of the 15th Five Year Plan, the silicone industry is undergoing unprecedented changes. Under the interweaving of four major trends: breakthroughs in bio based technology, explosive demand for new energy, stricter safety supervision, and capital market restructuring, enterprises can only seize the opportunity in the global industrial chain restructuring by adhering to technological innovation and green transformation. As Luo Liguo, Chairman of Hesheng Silicon Industry, said, "When the technology iteration cycle is shortened to 18 months and green tariffs erode 30% of profits, empirical decision-making has become ineffective. Only by building three core barriers: policy sand table, technology monitoring, and digital twin, can we cross the cycle and achieve sustainable development