Decline in Fly Ash Prices Driven by Imports in USA: Construction Industry Faces Challenges

In the United States, the price of Fly Ash experienced a decline in the initial half of August 2023. This was primarily attributed to more affordable imports from Europe and Canada, which significantly drove the bearish trend for Fly Ash. Adding to the situation, the U.S. Environmental Protection Agency  (EPA) recently proposed denying Alabama's permit program for managing coal combustion residuals, commonly referred to as Fly Ash, in landfills and surface impoundments. This marked the first instance of such denial for a state Fly Ash permit program. The EPA's rationale was rooted in the belief that the Alabama program fell notably short of the protective measures mandated by federal regulations, particularly concerning the well-being of individuals and water bodies. Meanwhile, demand from downstream construction industries remained stable, but no fresh orders emerged during the initial half of August 2023. The global decline in Fly Ash prices reduced demand, and ample supply contributed to the prevailing downward price trend. Furthermore, the U.S. Federal Reserve continued its trend of interest rate hikes in an effort to curb inflation, potentially increasing rates by an additional 0.5 percent. Manufacturing had already entered a recession as consumer spending shifted toward services, and this weakness had begun to infiltrate other sectors, including construction.

During the initial half of August 2023, the Chinese Fly Ash market sustained a downward trajectory. The downstream construction conditions in the South and East China markets remained unfavorable, resulting in sluggish market demand for Fly Ash. This scenario exerted significant inventory pressure on manufacturers, leading to an overall weak market sentiment. The construction industry downstream was notably impacted by extreme weather conditions, particularly in South and East China, where construction sites faced suboptimal working conditions. This, in turn, disrupted the balance between supply and demand in the regional Fly Ash market. As Fly Ash manufacturers' inventories swelled, intensified market competition drove them to adopt strategies like price reductions and promotions across various regions. However, a positive shift occurred as the weather began to improve during the latter part of August 2023, consequently facilitating a demand rebound. Notably, projects like the Jiangsu-Zhejiang S3 Line and Taichang Expressway were set to ramp up, fostering an optimistic outlook for future demand. Additionally, the resolution of local waterlogging issues led to the resumption of work at some construction sites, resulting in a slight uptick in sales. The post-rainy season demand replenishment also contributed to the recovery.