Soda Ash Imports Surge by 154.72%! Domestic Prices Below International Levels, Future Imports May Remain Weak

According to the latest statistics, from January to September 2024, China's total import of soda ash reached 9322,200 tons, an increase of 566,200 tons, or 154.72%, compared with the import volume in the same period last year. At the same time, the total amount of soda exported from January to September of 2024 was 717,300 tons, a decrease of 561,000 tons or 43.89% compared with the same period last year.

In the first quarter, domestic soda imports showed a steady growth trend. This phenomenon is mainly due to the significant difference between domestic and foreign soda prices, which are relatively low and thus attract a large number of imports. However, the recent domestic soda market oversupply situation has not been significantly improved. Despite some news stimulating the market, overall, the spot price of soda remains in a relatively weak state, and the gap between domestic and foreign prices is gradually narrowing, leading to a decrease in imports. At present, the delivery price of heavy alkali in the domestic east China market is about 1550 yuan/ton, while the average price of soda ash import in September 2024 is 205.99 US dollars/ton. Taking into account tariff (1.05), value-added tax (1.13) and exchange rate (estimated at 7), the price translated into RMB is about 1,700 yuan/ton or more. In terms of price differences, domestic soda prices are lower than foreign prices, so it is expected that the import volume will remain at a low level for some time to come.

According to the statistical analysis of customs data, in September 2024, China's soda import volume was calculated by production and sales countries, and the top three countries were the United Arab Emirates, the United States and Pakistan. Combined imports from the three countries reached 39,100 tons, accounting for 97.23 percent of the month's total imports. Among them, the United Arab Emirates and the United States accounted for 52.41% and 42.32% of imports respectively. The imported soda is mainly sent to Liaoning, Guangxi, Guangdong, Anhui and other places, where the main domestic glass production enterprises are distributed, so there is a certain rigid demand for soda.

From the perspective of the output of domestic soda, the operation of domestic soda plants is relatively stable, but there are still small adjustments. According to statistics, domestic soda production reached 2.82 million tons in September, with imports of 40,200 tons and apparent consumption of 2.73 million tons. Downstream glass industry profits continue to be at a low level, so the procurement of soda is more cautious, mainly to meet the basic needs. Entering October, soda plants are expected to continue to maintain stable operation, but individual enterprises may reduce production, and the supply is expected to increase slightly, with the output expected to be around 3.22 million tonnes; Soda imports are expected to decline somewhat, between 30,000 and 40,000 tons.

In terms of short-term market conditions, there may be a slight fluctuation in the soda plant in October, and the plant will remain generally stable as the traditional overhaul period comes to an end, but there may be some minor adjustments. Soda supply is expected to fluctuate at a high level, and with new units scheduled to come on stream in the fourth quarter, supply is likely to remain high. Downstream glass industry part of the production line there is the expectation of cold repair, so the purchase of soda is mainly low-cost rigid demand. In the market environment of oversupply, it is expected that the soda market may continue the trend of low shock in the short term. The market is greatly affected by sentiment, macro policy expectations are still strong, price fluctuations, market sentiment remains cautious.