(July 17, 2026) Recently, the domestic silicone special intermediates industry has ushered in multiple industrialization milestones. The continuous production lines of high-end low-volatility hydrogen-containing silicone oil and ultra-high hydrogen-containing silicone oil have successively reached full production. With the overseas exhibition technology overseas and the implementation of green processes in industry, academia and research, the hydrogenated silicone oil industry has completely got rid of its dependence on the import of high-end categories; downstream photovoltaics, new energy vehicles, AI The demand for immersed liquid cooling in data centers has exploded, and the industry's supply and demand pattern and market value have been structurally reshaped.
1. Implementation of industrialization: Two new high-end hydrogenated silicone oil products have achieved mass production of 10,000 tons.
In mid-July 2026, the two major silicone deep processing bases in East China and Anhui simultaneously disclosed core production progress. A set of high-end high-hydrogen silicone oil continuous equipment with an annual output of 35,000 tons has been stably put into operation at full capacity. The product can stably cover the mainstream ultra-high hydrogen content range of 1.2%-1.6%, and the content of small molecule volatiles has been greatly reduced. It is suitable for high-end scenarios such as photovoltaic TOPCon component packaging and power battery sealant, filling the domestic gap in the large-scale production of high-purity and high-hydrogen silicone oil in a wide range.
During the same period, low-volatility hydrogen-containing silicone oil customized for semiconductors and precision electronic packaging completed the mass production acceptance of 10,000 tons. The silicon-hydrogen bonds of this product are all concentrated at both ends of the molecular chain, with a molecular regularity of 99.2%. The purification process controls the hydroxyl impurity to less than 100ppm, which can effectively avoid the problem of platinum catalyst poisoning. It perfectly matches the production needs of addition-type liquid silicone rubber and chip potting gel, and breaks the long-term monopoly of overseas companies in the field of electronic-grade hydrogen-containing silicone oil.
On the production process side, the industry has completely eliminated the traditional intermittent hydrolysis process, and a new generation of continuous catalysis and balanced distillation purification technologies have become popular. Through the online spectrum real-time control system, the fluctuation of product hydrogen content has been narrowed from the traditional ±0.15% to ±0.03%, and the batch stability has been greatly improved. The Chinese Academy of Sciences and leading enterprises have jointly developed a chlorine-free one-step synthesis route and entered the pilot stage. The carbon emissions of the whole process have been reduced by 42%, realizing the transformation of green and low-carbon manufacturing.
2. Market conditions: The price of high-end high-hydrogen silicone oil continues to rise, and spot supply is in short supply.
Driven by centralized maintenance of equipment, slow release of new high-end refined production capacity, and downstream demand, the spot price of high hydrogen silicone oil will maintain a strong upward trend in 2026. Industry data shows that the price of high-end electronic/photovoltaic-grade hydrogenated silicone oil has doubled during the year, with the largest increase in a single month reaching 59%. The supply of 1.5%-1.6% high-hydrogen silicone oil dedicated to photovoltaic packaging continues to be in short supply.
The demand side has formed a traditional and emerging dual growth curve: Textile finishing is still the largest downstream, accounting for 42% of the overall market; the continued high growth of photovoltaic installed capacity has driven the rigid demand for packaging cross-linking agents; new energy 800V high-voltage platform batteries and high-temperature resistant sealing materials for energy storage boxes have significantly increased the consumption of hydrogen-containing silicone oil. The largest increase in the industry in 2026 will come from the AI computing power liquid cooling track. After the EU PFAS fluorine restriction regulations are fully implemented, hydrogen-containing silicone oil-modified insulating coolant has become a low-cost alternative to fluorinated liquids. The cost is only 10%-25% of traditional fluorinated oil. Leading domestic silicon companies have supplied domestic large-scale data centers in batches, and overseas orders are growing rapidly.
From a global perspective, China occupies 36% of the global market share of hydrogenated silicone oil, making it the world's largest production and sales market; in 2026, the localization rate of domestic high-end products will exceed 60%, and the growth rate of product exports to Europe and Southeast Asia will increase by 27% year-on-year. On July 16, domestic special silicone oil companies appeared at the CHEMUK International Fine Chemicals Exhibition in the UK, launching a series of low-hydroxyl customized hydrogen-containing silicone oils for the European LSR and electronic potting markets. Overseas high-end market orders continued to land, and domestic silicone intermediates accelerated their technology overseas.
3. Industry-university-research innovation: the implementation of high-value conversion technology of by-products to expand new application scenarios.
On July 15, Jiangxi's industry-university-research joint research project "Preparation of modified hydrogenated silicone oil from silicone by-products" was rated as a provincial-level scientific and technological achievement. The project overcomes the shortcomings of high hydrogen-containing hydrosilylation conversion efficiency and uses industrial by-product methyldichlorosilane to prepare structurally controllable modified hydrogen-containing silicone oil. It not only solves the pain point of low solid waste utilization rate in the organic silicon industry, but also develops special modified silicone oil suitable for data center immersion cooling and new energy cable insulation. In the past three years, the cumulative sales of related products have exceeded 300 million yuan, driving indirect economic benefits of the downstream industry chain to exceed 10 billion yuan.
In the direction of technology research and development, the industry focuses on three major upgrade paths: First, precise customization of hydrogen content, developing ultra-low/ultra-high hydrogen differentiated products for medical and aviation purposes; Second, composite functional modification, developing self-healing, high- and low-temperature resistant special hydrogen-containing silicone oil; Third, full-process green production, with closed-loop monomer recycling technology reducing production wastewater emissions by more than 70%, in line with global chemical environmental protection management and control requirements.
4. Industry Outlook: The five-year compound growth rate is 13.8%, and high-end production capacity has become the core of the layout.
Institutional forecast data shows that the overall market size of domestic hydrogenated silicone oil will grow steadily in 2026, with the industry's compound annual growth rate maintaining 13.8% from 2026 to 2030. High value-added fields such as new energy, electronics, and computing power cooling will continue to drive demand for high-end products. By 2031, the global market size is expected to exceed US$738 million.
Industry experts said that the current core contradiction in the industry is insufficient high-end refined production capacity and excess low-end general production capacity. Leading companies such as Dongyue Silicon Materials, Xin'an Co., Ltd., and Runfeng Co., Ltd. have all planned to add high-end hydrogenated silicone oil continuous production lines. In the future, the focus of industry competition will shift from basic production capacity to core technical capabilities such as molecular customization, purity control, and green processes. As domestic high-end hydrogenated silicone oil fully replaces imports, the advantages of my country's complete industrial chain of organic silicon will be further amplified, occupying a core position in the global new energy and new material supply chain.
