Caustic Soda Prices oscillate amidst unfavorable demand

Caustic Soda prices witnessed a marginal downfall in April in the USA and Germany due to reduction in demand from the downstream industries such as pulp, paper and the textile industry. Unfavourable demand from downstream pulp and paper sectors is the consequence of ample material availability and ultimately resulted in high supplies in the US. In India, approaching summers made the lower consumption of Caustic Soda in the textile industry.

Ample availability amid stable demand from the domestic market narrowed the demand-supply gap for Caustic Soda across the US market at the starting of April. As per the assessment, Caustic Soda prices have been fluctuating in the US market since the first week of March, owing to lower imports from key destinations like China, as the country is witnessing resurgence in pandemic cases leading to the imposition of strict lockdown restrictions. However, prices have been easing from its previous high value, which remained the major reason behind the marginal decline in Caustic Soda prices. Conclusively, as per ChemAnalyst, the prices of Caustic Soda declined by 3% in the USA in the month of March.

Similarly, the European market witnessed a decline in the prices of Caustic Soda by 3% in April because of low demands from the downstream industries due to the low production cost amid hiked energy values. Energy values surged because of the ongoing geopolitical tension between Russia and Ukraine. Moreover, in Asia, the price trend of Caustic Soda witnessed firmness due to the turnarounds in major chemical producing cities of China such as Shanghai because of the zero-covid policy implemented in the country.

As per ChemAnalyst,” the price trend of Caustic Soda is expected to show gradual ease in the European market as material availability is likely to surge because of the Russian invasion of Ukraine. If Russia- Ukraine conflicts will show no signs of relief then prices will continue to fluctuate as the supplies will remain disrupted for export activity.” Additionally, supplies from China also likely to be disrupted in the USA which will result in the availability of materials with the US traders. To maintain an average offtakes in the market, supplies are expected to surge in the domestic market of the USA causing a decline in Caustic Soda prices.