Despite Adequate Demand, Long Supply Dominates Prices of Sodium Sulphate in Germany

Hamburg(Germany):  The Sodium Sulphate market in Germany has seen declines as sufficient stocks meet available downstream demand. Henkel reported strong organic sales growth in the first quarter of May 8, 2024. Additionally, the European Central Bank (ECB) cut interest rates by 25 basis points, lowering the deposit rate to 3.75%, in alignment with reductions in Canada, Sweden, and Switzerland. The Eurozone PMI for May 2024 slightly decreased from April, indicating the strongest increase in economic activity since May 2023. Stronger Sodium Sulphate demand boosted output and hiring, with business confidence rising for the seventh time in eight months. While inflation rates for input Sodium Sulphate costs and output charges have moderated, they remain above pre-pandemic levels. Efforts to Sodium Sulphate improve reliability include faster sailing and increased capacity.

 Sodium Sulphate prices are expected to continue rising due to strong demand from domestic as well as from the international market. Furthermore, demand from the downstream laundry and detergent industries is expected to remain firm.

The ongoing Red Sea crisis continues to disrupt global Sodium Sulphate supply chains, particularly affecting Asian markets, with no resolution in sight. Despite this, domestic Sodium Sulphate production remains strong, meeting high demand from downstream industries, notably laundry and glass industry. Although a potential price increase is anticipated due to heightened risks from Houthi activity in the region, ocean freight rates for Sodium Sulphate from Asia to Europe are surpassing contract rates as vessel capacity tightens due to the crisis.

The Sodium Sulphate downstream laundry, detergent, and textile sectors in Germany are currently showing mixed demand, characterized by varied market trends. According to Henkel, a leading company in the Sodium Sulphate downstream detergent and homecare sector, their Q1 2024 report released on May 8, 2024, highlighted significant developments. The Laundry & Home Care business area reported strong organic sales growth of 4.6 percent during the first quarter. This growth was primarily driven by a substantial increase in the Fabric Care category within the Laundry business. Additionally, the Home Care business saw notable organic sales growth, with double-digit increases in the Toilet Care and Dishwashing categories. In the Consumer Brands business unit, despite a nominal decrease in total sales by -6.0 percent to 2,605 million euros compared to the prior-year quarter, organic sales increased by 5.2 percent when adjusted for foreign exchange impacts and acquisitions/divestments. Foreign exchange effects negatively impacted sales by -4.0 percent, while acquisitions and divestments further reduced sales by -7.2 percent. Overall, Henkel's report underscores strong performance in the Laundry & Home Care segments, driven by solid growth in key product categories despite challenges in overall sales due to foreign exchange fluctuations and portfolio changes.