Soda Ash Prices in China to Showcase Slow Recovery on Uncertainty in Demand from Downstream Industries

Soda Ash prices in China have remained on a stable to narrow range since the beginning of February. Consumption of Soda Ash in China mainly comes from construction and photovoltaic segments. Limited activities in the construction sector and fluctuating demand for photovoltaics have been the major factors responsible for the dull offtakes of Soda Ash in the domestic market.

The demand supply gap of Soda Ash is deemed nearly stable. Currently, buyers have been witnessed purchasing Soda Ash on need basis. Prices of Soda Ash were assessed marginally up by nearly 1% in the week ending 18^th January. As per ChemAnalyst, “A significant revival in Soda Ash prices cannot be expected in the near term. However, gradual recovery is likely to be witnessed following the likelihood of normalcy in construction activities coupled with the promotion of photovoltaics.”

Despite of the dull demand, Soda Ash weekly output in China has increased by 0.20% since late-January on weak-on-weak basis. Analysing the seasonal trend for every year, Soda Ash operating rates are likely to remain on a higher side till April. However, there are several mainstream manufacturers that are currently under maintenance. Zhonguan Chemicals has announced a maintenance turnaround at its plant from 5^th February, which is expected to last for 20 days. Similarly, Jiangsu Shilian has announced a planned outage at its Soda Ash plant from 16^th February.

Recent announcement of China’s Five-Year Development Plan has again induced hopes for the looming construction sector in the country. Besides, strict environmental measures across the globe are expected to boom the activities in the photovoltaic segment. However, high prices of the upstream silicon material still pose a challenge in the overall development of the sector.