Foreword: At the beginning of the new year, the soda ash market as a whole has shown a steady and downward trend. Market prices have been continuously lowered. Companies are pessimistic. Under the condition of "high supply, low demand", some people are still bearish on the soda ash market outlook.
Entering 2024, the price of soda ash will continue to decline. At the beginning of the month, the price of light soda ash in China was 2,550 - 2,850 yuan/ton, and the price of heavy soda ash was 2,750 - 3,000 yuan/ton. The spot price has continued to decline and is getting worse and worse. As of press time, the price of light soda ash in China is 2,300 - 2,550 yuan/ton, and the price of heavy soda ash is 2,450 - 2,700 yuan/ton. The cumulative price has dropped by more than 400 yuan/ton, a decrease of about 16%. The focus of transactions in the soda ash market has stabilized and moved downward;
Due to the resumption of production by some equipment maintenance companies in the early stage, the supply of soda ash has gradually increased. Coupled with market news that Yuanxing's third line will soon ship products. With the increase in the supply side, the sentiment of soda ash market has been negative, and the purchasing sentiment of downstream companies is more cautious. The stocking plan has not yet been reflected. As the number of orders to be issued in the early stage decreases, the inventory of soda ash companies has gradually increased. Under the influence of shipping pressure, the price of new orders has been continuously adjusted, and the spot soda ash market has been operating steadily and weakly.
According to Boduo data, China's cumulative soda production from January to November 2023 was 29.481 million tons, an increase of 2.904 million tons compared with the same period last year, an increase of 10.93%. The annual output is expected to be 32 million tons, a year-on-year increase of 11%. As can be seen from the figure below, the monthly output of soda ash in 2023 will increase differently compared with 2022. The output of enterprises has steadily increased. In December, enterprises such as Anhui Hongsifang, Shandong Haitian, and Shandong Haihua resumed production. In addition, enterprises such as Henan Jinshan have increased equipment and the supply of soda ash has increased significantly.
Due to the weakening of the soda ash market and the continuous increase in the supply side, market shipping pressure is great. With the recent announcement of new order prices by soda ash companies and the decline in spot prices, the pressure on companies to sign new orders has increased, and the inventory of soda ash manufacturers is on the rise; In January, the inventory of soda ash manufacturers was approximately 100,000 tons higher than that in January 2023.
Conclusion: The market is weak, industry consumption has declined, and downstream companies 'purchasing sentiment is weak, and most of them remain focused on demand. However, as the soda ash market continues to be affected by the expected impact of increased supply, the spot market is difficult to improve, and prices continue to fall back to low levels; but as the Spring Festival holiday approaches, some companies still have pre-holiday pre-holiday stocking needs, but the demand may not be as expected. In the short term, the demand in the soda ash market is weak and prices are stable; However, in the long run, new production capacity will be released in the soda ash market in 2024, and both soda production capacity and natural soda production capacity will increase. It is expected that the soda ash production capacity will reach 40 million tons in 2024; it is difficult to suppress the recovery of soda ash prices, and manufacturers 'inventories continue to show an increasing trend, and soda ash prices are expected to fall again.
