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Global Caustic Soda Prices Decline Due to Weak Downstream Demand

Global Caustic Soda Prices Decline Due to Weak Downstream Demand

Global Caustic Soda Prices Decline Due to Weak Downstream Demand

  • 16-Nov-2022 2:23 PM
  • Journalist: Gabreilla Figueroa

With muted demand from the downstream Alumina industry, global Caustic Soda prices showed another decline trend during the week ending 11 November 2022. Besides, the rising energy prices led to inflationary input cost pressure on the Caustic Soda market throughout October 2022.

Chinese Caustic Soda prices stabilized at the end of the second week of November 2022 after falling steadily the previous week due to weak demand fundamentals. The sufficient supplies continued to outpace commodity demand, and this week Chinese manufacturers focused on exports amidst muted domestic demand. The Chinese yuan depreciation against the US dollar led market players to export more products. The Caustic Soda downstream market experienced a wait-and-see attitude amongst the domestic buyers for further price negotiations.

European Caustic Soda experienced a slump in the price trend this week owing to declination in domestic inquiries from the Alumina sector amidst diminished operations in the downstream industry and ample availability of stocks. The market players revealed that Caustic Soda spot prices would fall further toward the end of the year as the European governments imposed energy price caps impacting production costs of the commodity. Meanwhile, natural gas supplies have been lowered, and the energy suppliers have encouraged residential and industrial users to reduce power consumption to avoid winter collapses. Lower downstream demand has compelled the sellers to negotiate Caustic Soda prices to rebuild buying sentiments in the regional market.

According to ChemAnalyst prediction, "Prices of Caustic Soda are likely to decline globally due to stability in the demand from the end-user detergent and Alumina industries. Caustic Soda demand is likely to be influenced by the bearish market sentiments in Europe due to the slump in production activities in the downstream Alumina segment. Moreover, supply constraints across the significant global economy will impact the price momentum of Caustic Soda globally in November 2022. "

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