According to China Chemical News, how can the soda ash industry—facing oversupply, weak demand, and intensifying homogeneous competition—achieve a transformative leap from price competition to value enhancement? The key lies in driving green manufacturing through technological breakthroughs, establishing green benchmarks via energy conservation and carbon reduction, fostering synergistic win-win outcomes through ecosystem building, and exporting Chinese solutions through global expansion.

Supply-Demand Dynamics Shift as Industry Operates Under Pressure

In 2025, the soda ash market continues to exhibit characteristics of ample supply, weak demand, and price pressure. With sluggish downstream demand intertwined with new capacity releases, industry inventories remain elevated, placing the market in a cyclical adjustment phase.

Supply Side Continues to Grow

In 2024, China's total soda ash production capacity exceeded 40 million tons. with production reaching 28.639 million tons in the first three quarters of this year—a year-on-year increase of 4.931 million tons, averaging 104,500 tons daily. New domestic soda ash capacity exceeding 2 million tons has been added this year, with an additional 3.5 million tons slated for market release soon. Furthermore, the domestic natural soda ash industry is advancing toward a 30% share of total capacity.

Demand momentum remains insufficient. The core downstream application for soda ash is float glass, accounting for 35%–40% of total soda ash demand. Float glass is primarily used in the real estate construction sector. In the first half of the year, new housing starts declined year-on-year, dampening demand growth for soda ash in this sector. Another key downstream application, photovoltaic glass, represents 10%–15% of total soda ash demand. However, with profit margins squeezed in this industry, its short-term pull on soda ash demand remains limited.

The adjustment in supply-demand dynamics is directly reflected in inventory changes. Starting from March 2024, soda ash inventories rose steadily from 400,000 tons to a peak of 1.9 million tons, subsequently stabilizing above 1.4 million tons. Entering 2025, inventory levels have fluctuated occasionally but remain overall at historically high ranges. As of November 27, soda ash producers held total inventories of 1.409 million tons, with delivery warehouses stockpiling 583,800 tons.

Intensifying Homogeneous Competition Drives Industry Breakthrough Efforts

Amidst a supply-strong, demand-weak landscape, product homogenization has become pronounced. Some enterprises resorted to price competition strategies, squeezing overall industry profit margins and amplifying pressure for transformation and upgrading.

Significant price declines have pressured industry profits. Heavy soda ash prices peaked at a historic high of 3,681 RMB per ton in October 2021. During the third quarter of this year, the domestic heavy soda ash price index fluctuated between 1,218.57 and 1,344.29 RMB, while the light soda ash price index ranged from 1,152.86 to 1,285.71 RMB. The soda ash industry's profits turned negative for the first time in September 2024 and plunged back into losses in July 2025. Half of the listed companies reported negative net profits attributable to shareholders in the fourth quarter of 2024, and by the second quarter of 2025, the proportion of loss-making companies remained at 25%.

Natural soda ash emerged as a disruptive force due to its cost advantage, with its production share rising from 5% in 2022 to 17% in 2025. Its unit cost is significantly lower than that of the combined soda-ammonia process and the ammonia soda process. This absolute cost advantage positions natural soda ash to compete effectively in future markets.

As the world's largest producer and consumer of soda ash, China accounts for over half of global production capacity. However, the industry has long been mired in homogeneous competition. The key to breaking this deadlock lies in technological upgrades and service optimization to break the “price reduction-loss” cycle and enhance comprehensive corporate competitiveness.

Value-Based Competition Breaks the Deadlock; Transformation Path is Clear

With technological and intelligent upgrades, value competition replacing price competition will become the key to breaking the deadlock in the soda ash industry.

Redefining the value chain and driving industrial upgrading are now urgent priorities. Currently, the industry still lacks sufficient production capacity for high-value-added products that meet the demands of high-end sectors like new energy. This requires enterprises to climb toward the high end of the industrial chain through technological innovation and service upgrades.

In technological innovation, the industry is focusing on R&D for key technologies such as clean production in the ammonia-soda process, efficient extraction of natural soda ash, and comprehensive resource utilization.

In energy conservation and carbon reduction, implementing energy-saving technical upgrades and promoting equipment like waste heat recovery systems is expected to significantly lower the soda ash industry's energy consumption and emission intensity. Leading enterprises' technical renovation projects are projected to achieve substantial reductions in comprehensive energy consumption per unit of product and annual carbon emissions cuts of tens of thousands of tons.　In building an industrial ecosystem, enterprises are shifting from independent operations to collaborative development.

Globally, China's advanced soda ash production technologies are expanding worldwide through Belt and Road cooperation. For instance, Indonesia's first soda ash project utilizing China's Hou process (combined soda-ammonia process) has commenced construction. This represents not only the export of mature industrial technology but also contributes to diversifying the global soda ash industrial chain.

Looking ahead, China's soda ash industry will establish a comprehensive competitive edge centered on “technology, brand, and service” by continuously enhancing its capacity to supply high-end products, promoting green processes, and deepening value chain integration. This will enable the industry to secure a more significant position in the global market and ultimately achieve a win-win outcome for both economic and environmental benefits.

As an integrated internet platform providing benchmark prices, on December 11th, the benchmark price of light soda ash according to SunSirs was 1258.00 RMB/ton, an increase of 2.78% compared to the beginning of the month (1224.00 RMB/ton).

Application of SunSirs Benchmark Pricing：

Traders can price spot and contract transactions based on the pricing principle of agreed markup and pricing formula (Transaction price=SunSirs price + Markup).

If you have any inquiries or purchasing needs, please feel free to contact SunSirs with support@sunsirs.com.