Metallurgy / Chemicals / Rubber & Plastics

The import and export volume of soda ash in March exceeded expectations, indicating that the trend of positive exports is still continuing, "said a frontline person in the soda ash market recently.

The latest import and export data from the General Administration of Customs of China shows that in the first quarter of 2023, the export of soda ash reached 450700 tons, a year-on-year increase of 45.10%; 47500 tons of imported soda ash, a year-on-year decrease of 37%. According to import and export data, 163000 tons of pure alkali were exported in March, an increase of 18600 tons year-on-year; Imported pure alkali reached 45600 tons, an increase of 38500 tons year-on-year.

Previously, the market expected a decrease in the export volume of soda ash and an increase in the import volume. However, based on actual data, its performance exceeded market expectations, "said Zhou Xiaoyan, senior analyst at China Investment Anxin Futures.

Zhang Linglu, an analyst at Everbright Futures, believes that the significant increase in imports of soda ash in March was mainly due to the tight balance between domestic supply and demand. Downstream enterprises need to supplement their usage through imports, and most of them are concentrated in float glass factories and photovoltaic glass factories. This portion of the import increment directly enters downstream glass factories after arriving at the port, which has a relatively limited impact on the market. However, to some extent, it may lead to downstream manufacturers reducing the quantity of soda ash purchased from domestic manufacturers. Huacheng Import and Export Data Observation Report.

The export volume in March further increased to 163000 tons on the basis of last year's high base, exceeding market expectations, indicating that the industry's supply and demand are thriving and exports are still improving. Wei Chaoming, a senior analyst at Fangzheng Intermediate Futures, believes that in 2022, international energy prices were high, and exports of soda ash were significantly increased. This year's export volume can further increase on the basis of last year's high base, It shows that the international market has strong resilience in demand for soda ash, and the expectation of a significant weakening in international demand needs to be corrected. Huacheng Import and Export Data Observation Report.

In response, Li Jiahao, an analyst at Nanhua Futures, stated that compared to last year, the expected export of soda ash this year has weakened. Mainly due to the return of supply in the context of the decline in foreign energy, the price difference between domestic and international alkali has shrunk, and the decrease in sea freight has led to a weakening of exports compared to the previous month.

In the short term, exceeding expectations in the import and export data of soda ash is a circumstantial evidence of the healthy operation of the domestic soda ash market. The profits of Lian Alkali Enterprise are still relatively high, and with Yuanxing Energy's new production capacity approaching production, various manufacturers have no maintenance plans for Poly Run, maintaining a high market supply. The demand for light alkali is unlikely to improve in the short term, while the downstream float glass market for heavy alkali is good or driving an increase in production capacity. The expected transformation of the supply and demand pattern in the later stage has led to significant changes in the current mentality of the supply and demand side. It is expected that in the short term, soda ash manufacturers will still be actively shipping, and spot prices will maintain a downward trend. Overall, the short-term pure alkali market is expected to fluctuate in the game of steadily increasing demand for heavy alkali and continuously declining spot prices.