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PRICE OF CAUSTIC SODA IS RISING VERY MUCH AND VERY QUICKLY FROM LAST MONTH

2019-06-28 23:53:13  admin  114

Since last week, the price of caustic soda has been on the rise. Coupled with the deflagration incident of Dongxing Chemical Company this week, the price has risen again. In the short period of two weeks in northwest China, the price has risen by RMB 500-600/ton, an increase of 20%-25%, and manufacturers and traders is still increasing price of caustic soda. So, what is the actual situation in the current market and how should the market go? And look at the analysis below:


1. Safety inspection, the start of the enterprise equipment decline. The recent explosions occurred frequently, and safety inspections were carried out nationwide. The start of chlor-alkali enterprises was also affected. The “3.21” Yancheng explosion occurred, some local enterprises were shut down, production capacity was reduced, and most enterprises cut production during the inspection period. In addition, this week’s Dongxing company’s deflagration incident, The company has stopped production, and local enterprises in Inner Mongolia will also be affected. From this point of view, the current chlor-alkali enterprise installations have declined, the overall supply of goods has decreased correspondingly, and some enterprises have a tight supply situation.


2. The coming of the maintenance season. In May, during the centralized maintenance season, some enterprises have maintenance or down-consumption plans, and affected by the Dongxing deflagration incident, the maintenance time is bound to be extended. It is understood that the impact of maintenance from the end of April to May is about 4.8 million tons.


3. Support for cost side. In the early period, the price of liquid alkali fell all the way, and the price of high alkali fell below 1,000 yuan/ton. The company adopted a strategy of reducing the burden. In addition, some equipment installations were repaired in April, the supply of the market was reduced, and the price of liquid alkali was also rising. It has a certain supporting effect on the cost of caustic soda.


4. Downstream demand has not improved. Some enterprises in the alumina industry have reduced production due to ore and losses. The operating rate of the equipment is around 80%-85%. Other downstream industries such as printing and dyeing, chemical, chemical fiber and other industries are affected by environmental protection, and the operating rate has not been high. Will exceed 70%.


5. The replacement of domestic bauxite by imported bauxite has become a trend. In 2019, affected by environmental protection, the supply of domestic aluminum ore was tight, and the proportion of alumina producers using imported ore was increasing. At present, domestic alumina plants use high-temperature method to produce alumina, while imported bauxite is mostly low-temperature ore. The amount of alkali consumed is only 1/2 of the high temperature method, which will also have a greater impact on the caustic soda market.


In summary, due to the large number of traders in the first two weeks, the market in the northwest region was low, and some enterprises even needed to pick up the goods according to the order. At the same time, the Dongxing company’s deflagration incident, some enterprises in the northwest have been closed, which has played a certain role in the market. With the help of the wave, and the overhaul, the recent soda market is undoubted!


In addition, we must also see that although the current factory inventory is low, but the traders in the hands of more goods, social inventory is still high, although the recent downstream rigid demand has increased, in general, downstream demand has not substantially improved If there is no demand support, the uptrend will not be maintained. It is recommended that the industry be cautious! Of course, for the current crazy market, all views will become empty talk! ! !


At present, downstream demand has not seen substantial improvement, and it is unable to provide favorable support for the market. However, due to the relief of high inventory of enterprises in the northwest region and the added support of the market, the price increase of manufacturers and traders has intensified. In view of this, it is expected that the domestic market for caustic soda will continue to rise next week.


In addition, the time for alumina signing, and the arrival of the maintenance season, how to go in the market after the supply and demand game, in the late stage should pay more attention to the changes in the alumina signing situation and market inventory.

:SODA ASH: THE CONTRADICTION BETWEEN SUPPLY AND DEMAND IS PROMINENT :None Back
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