The Caustic Soda prices continued to stabilise across the globe in the first week of May 2024 as a result of a slowness in the downstream demand and limited stock availability amid several planned plant turnarounds in the region during April 2024. Moreover, Caustic Soda manufacturers opted to reduce production rates due to a sluggish downstream procurement trend. Simultaneously, plant shutdowns in China during April 2024 heightened competitiveness in the global market.

South Korean Caustic Soda prices were stabilized by the slow domestic demand from the downstream alumina industry despite stronger-than-expected economic growth in the first quarter. Market participants in the Caustic Soda industry in South Korea bolstered margins by raising prices in the regional market, as improved export performance offset declining household consumption. In South Korea, Hanwha Chemical and LOTTE Fine Chemicals underwent a maintenance turnaround during April 2024 further slightly tightening the supplies in the South Korean Caustic Soda industry while balancing demand-supply situation in the market.

The first week of May 2024 saw the stabilization of Chinese Caustic Soda prices due to low supplies, while downstream demand remained steady. According to the latest data from the NBS, new export orders grew at a much slower rate, while employment continued to shrink during April 2024. From the domestic demand side, the Aluminium production activities showed some momentum, with a slight increase in the consumer procurement sentiments. Caustic Soda market was further impacted by the ongoing production curtailments in Yunnan, China, attributed to the annual dry season, which persisted in limiting supply. The maintenance plant shutdown at Two Lions (Zhangjiangang) Fine Chemicals Co., Ltd., with a production capacity of 33333 TPM for 29 days in April 2024, further tightened supplies in the country.

The Caustic Soda prices in the European market were impacted by the controlled production rates and shortage of stocks during this timeframe. As per the latest analysis, the costs of Caustic Soda production were increased primarily due to rising energy prices. Cost inflation remained significantly higher than historical trends. Additionally, a Force Majeure at Nobian GmH Werk Bitterfeld facility of Caustic Soda in Bittereld-Wolfen and maintenance turnaround at Vestolit GmH in Marl in the German market also contributed to the tightening of the supplies in the first week of May 2024. According to BASF earning report of Q1 of 2024, the global chemical industry experienced a modest recovery in the first quarter of 2024, expanding significantly faster than overall industrial production as customer industries somewhat restocked their very low inventories during this timeframe.

As per ChemAnalyst, the Caustic Soda price trend is likely to rise in the Asian market due to an anticipated increase in the downstream Alumina demand and limited supplies. However, European Caustic Soda prices are expected to ease down as the low downstream consumption may outweigh the constrained supplies in the coming weeks.