SunSirs: Caustic Soda Prices Fell This Week (September 22-26)

Price trend

According to the SunSirs commodity analysis system, caustic soda prices fell this week. The average market price was 838 RMB/ton at the beginning of the week and 837 RMB/ton at the weekend, a 0.48% decrease and a 0.12% year-on-year increase.

On September 25th, the SunSirs Chemical Industry Index was 765 points, unchanged from the previous day. This represents a 45.36% decrease from its intra-cyclical high of 1,400 points (October 23, 2021), and a 27.93% increase from its intra-cyclical low of 598 points on April 8, 2020. (Note: The period refers to the period from December 1, 2011 to the present.)

Analysis review

According to the SunSirs commodity analysis system, caustic soda prices fell over the weekend this week. In Shandong Province, the mainstream market price for 32% ion-exchange membrane caustic soda is around 760-850 RMB/ton. In Jiangsu Province, prices are stable, with prices around 890-990 RMB/ton. In Inner Mongolia, prices are consolidating, with prices around 2700-2800 RMB/ton (convert into 100%). In Shandong Province, supply is relatively abundant. Low-concentration caustic soda prices are under pressure in Shandong Province. The recent continuous decline in alumina prices both domestically and internationally has led to shrinking profit margins for domestic alumina manufacturers. Consequently, downstream alumina manufacturers are primarily purchasing on-demand, while non-aluminum imports are also primarily purchasing on-demand. Furthermore, due to the upcoming National Day holiday, caustic soda manufacturers have softened prices to reduce inventory, but overall, prices are likely to remain stable in the later period.

Market outlook

SunSirs’ analysts believe that the price of caustic soda has been running weaker recently. The domestic downstream has been purchasing on demand recently, and the inventory of caustic soda companies is relatively abundant.Supply and demand are in a game. It's generally expected that caustic soda will maintain a consolidation trend in the future, depending on downstream market demand.

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