Soda Ash: Production Restriction!!!

On April 13, the China Soda Industry Association requested all soda companies to reduce production by 30% based on their soda capacity from April 18, 2020 to October 18, 2020, to reduce soda production and inventory. In order to return the industry economy to stability, companies that fail to limit production and reduce production will be punished.

This week, China soda ash market is in general, overall market trend is not good. Factory equipment starts to load normally, the inventory remains high, the soda ash mainstream transaction price is low. No. 10, Hubei Shuanghuan device production reduction, about 10 days planned, Fujian Yaolong parking maintenance. It is estimated that it will take a month. The production reduction or maintenance of the two places will affect the demand of local areas. It is understood that Jiangsu Shilian has the willingness to overhaul at the end of April. Other manufacturers maintain the wait-and-see, but the overall impact is not large, and the market oversupply situation has not yet Changes, downstream enterprises still wait and see procurement, short-term soda prices will be in a weak state of operation, mainly depends on the manufacturers resumption of work and policy changes.
As of April 7, domestic soda ash stocks are still high, manufacturers are slow to ship, and it is difficult to reduce stocks. It is difficult to reduce domestic soda ash stocks in the short term. China Soda ash Industry Association requires companies to reduce their load by 30% based on their soda ash production capacity. Production, reducing the output of soda ash and consuming inventory, so as to solve the situation of uneven supply and demand.
Analysis of market influence factors
The cost side: the original salt market maintains stable operation, the supply and demand of manufacturers are balanced, and it is neutral in the soda market.
Supply side: Affected by the epidemic, the domestic soda ash market is weak, and the overall operating rate in the country has increased. The maintenance companies have gradually returned to normal. The market supply is not affected by the epidemic. The growth rate is not obvious. It is in a bearish trend, and downstream demand has returned. Slowing down, manufacturers gradually resume work, and purchases have increased, but the overall trading atmosphere in the market is still relatively deserted, the market situation is driving in a negative direction, and manufacturers ’inventory pressures remain, downstream demand boost is more difficult to change, and short-term low-price maintenance is stable. The amount of warehousing is mainly.
Demand side: Soda ash terminal products are blocked, the glass market is gradually resumed, but the overall market trading has improved, but prices in some areas are still trending downwards, market demand is weak, the East China region is impacted by low-cost supply from foreign ports, and sales pressure is greater. The transaction is biased towards flexible prices, prices in North China have been mobilized, market demand has improved, and inventory consumption has been more obvious, but the glass market cannot bring a positive trend to the soda ash market in the short term, and it is expected that the short-term demand trend will remain deadlocked.