Increased demand coupled with reduced supply has brought about a significant rise in caustic potash prices within Asia. Markets tried bouncing back after the declines witnessed in October, as it sharpened up the global potash expectations, resulting in less imports from the country. Switching of production at Qinghai Salt Lake was directed towards higher outputs of potassium chloride. Southeast Asian ports are showing a strong interest in buying, especially Indonesia and Malaysia, which are gearing themselves for B50 biodiesel scheme in Indonesia. International supply concerns, including road disruption across Europe, also constituted pressure on demand. This has further contributed to increases in price, which analysts usually attributed to fertilizers, pharmaceuticals, food, and electroplating. However, experts warn of sustainability challenges in 2026 given high fertilizer costs and firmer commodity prices.
Caustic potash (KOH) continued its increase in the Asian market through the final week of November 2025, due to the further reduction in supplies, with the downstream demand further supported by a fresh increase in global potash sentiment. There were strong offers from traders in mainland, Southeast, and South Asia.
In the Chinese Caustic Potash market, the potash industry remained the primary driver that contributed to the increase in Caustic Potash prices. However, after a brief downturn in October, the caustic potash and potassium chloride markets in China recovered in November, supported by expectations of a tighter potash supply in the global market. Earlier, the Chinese potash industry attempted to ease prices through joint-import policies, but the potash market dynamics shifted as imports in the country reduced by nearly 300,000 tons year-on-year from January to October. Meanwhile, production quality in Qinghai Salt Lake shifted, with production tending more towards 57% potassium chloride.
Such escalation contributed to rising caustic potash prices in the main importing centers of the Asian continent. Ports within Southeast Asia, particularly in Indonesia and Malaysia, were continuing to display strong purchasing interest. Both nations experienced a sharp year-over-year increase in potash imports in 2025, largely driven by preparations in Indonesia for the B50 biodiesel scheme, which will come into operation in 2026.
International supply issues also contributed to the Caustic Potash price action this week. With the closure of overland routes from Lithuania to Poland and Belarus, there was concern over the possibility of any potash supplies being interrupted. Although caustic potash and MOP are different products, they do use the same chain, so positive news was also reflected in the Asian caustic potash market. Companies such as Nutrien indicated that the world would be a tighter market in 2026.
Downstream demand in the Asian region also contributed the increase in the Caustic Potash market. This was due to Northeast Asian fertilizer production that entered its peak season, as well as constant use in pharmaceutical industries, the food industry, and electroplating. Meanwhile, some buyers who did not restock their supplies in October returned to the market as Caustic Potash prices climbed.
As per ChemAnalyst, although there has been some improvement, some analysts still say that this rise may not be sustainable in the medium term. At least the high cost of fertilizers in the global market is starting to affect farmers’ purchasing power, as well as the softening of agricultural commodity prices, which may dampen Caustic potash demand in the coming year of 2026. However, as of the week ended November 28, the prices of caustic potash in the Asian market remained strong.
