Lead: Before May Day, the soda ash market was on a strong upward trend, and supply increased and decreased simultaneously. Market maintenance expectations increased in May, and companies had orders in hand. Can prices break the situation and rise again?
According to data from Boduo, the soda ash market will continue to decline in 2024. Since the beginning of the year, the price has dropped to early April, the price of light and heavy soda has dropped to around 1000 yuan/ton, a drop of nearly 50%. The main reason for the price decline is strong market supply and weak demand., corporate inventory pressure is great, and the market is stable and weak. Entering April, the number of maintenance companies in the soda ash market has gradually increased, the market starts have declined, and the price of soda ash has gradually stopped falling. Due to the May Day holiday, the demand for stocking in the downstream market has increased, and current purchase expectations have increased. The relationship between supply and demand in the market has gradually changed. The price of soda ash has increased. The price has increased by around 300 yuan/ton, an increase of 10%. Market transactions have stabilized and increased. The reason for the price increase is mainly due to the maintenance of some soda ash enterprises, the reduction in supply, and the increase in downstream procurement. Market shipments are relatively good, manufacturers have gone to the warehouse, and market production and sales are basically balanced.
According to the data: In March 2024, soda ash output was 3.229 million tons, and the output started at a high level. From January to March 2024, China's soda ash output totaled 9.404 million tons, a year-on-year increase of 7.803 million tons, an increase of about 1.601 million tons; In April, the market entered the maintenance season, and some soda ash companies successively have maintenance plans, and the output in April will decrease or month-on-month; It is reported that the output and start-up of scattered enterprises are expected to remain high during the overhaul in May, and the market maintenance volume will have little impact on output in the short term.
After the holiday, the high inventory of soda ash manufacturers was slightly removed from the warehouse. As of May 9, the inventory statistics of soda ash manufacturers were 893,000 tons, a decrease of 5,000 tons compared with the previous week, a decrease of 0.56%. The shipment situation of soda factories before the holiday was relatively good, with the support of orders in hand from enterprises, and the transaction of new orders weakened after the holiday. Manufacturers successively delivered orders in hand, and the inventory dropped within a narrow range. Most companies had low inventories, and some companies had high pressures.
According to customs data, in March 2024, China imported 215,500 tons of soda ash, a year-on-year increase of 372.93%, and a month-on-month increase of 18.57%. The amount of imported soda ash hit a record high; the cumulative import volume of soda ash from January to March 2024 was 534,700 tons, a year-on-year increase of 1027%, and the import volume increased by approximately 487,300 tons. The price of imported soda ash is low, which has an advantage compared with the price of Chinese soda ash. The increase in imported soda ash is large this year.
Overall, although some companies in the market started maintenance in April and May, as the weather gradually warms up, July-August is the traditional maintenance season. China's soda supply is expected to shrink, but the market still has expectations that imported soda ash will arrive in Hong Kong. The supply of soda ash may be limited; enterprises in the downstream market have started to operate normally, demand for light weights is relatively stable, and downstream demand for heavy goods is increasing. Among them, float production lines have little fluctuations, new photovoltaic production lines are obvious, and soda ash consumption has increased. In May, the trend of soda ash may remain volatile. The market supply and demand are in a game. Purchasing sentiment is still relatively cautious, and transaction prices are negotiated on a single basis.
