Low Inventories and Strong Demand Inflate Potassium Carbonate Market
- 30-May-2022 3:28 PM
- Journalist: Xiang Hong
Wuhu, China: The price of potassium carbonate rebounded in the regional market of Shanxi. The import price of feedstock Potassium Chloride is stable, but supply constraints and rising freight rates have resulted in a material shortage. Manufacturers have been observed revising their margins, foreseeing the low availability in the Chinese market.
The growing adoption of Potassium Carbonate from the downstream detergent industries, food and beverage processing, animal feed, and potash fertilizer is booming. Furthermore, high demand from the detergent industry is another major factor driving the market for Potassium Carbonate. In addition, increasing sales of potassium carbonate in the glass industry can be attributed to high orders for glass from the construction sector. Besides this, potassium Carbonate inquiries from the automobile and consumer goods sectors are boosting its market.
"Because China's potash market is based on more than 50% imported products, there is a strong correlation between domestic and overseas potash fertilizer prices." An importer from Shanxi confirmed. He also quoted, "China accounts for around 30% of global consumption of Potassium Carbonate, which has different quality grades and is highly demanded from pharmaceutical and food industries".
Therefore, affected by the Russia-Ukraine war, Supply Chain snags, and lockdown restrictions in China have contributed to the soaring prices of Potassium Carbonate. A source from Shanxi confirmed that "In the face of strong demand and low availability of materials, manufacturers raised the value of Potassium Carbonate to secure their profit margins."
Meanwhile, amid soaring competition, the top five players comprising: Oxy (Occidental Petroleum Corporation), Evonik, Zhejiang Juhua Co. Ltd., AGC Chemicals, and Armand Products' operating rates improved and are projected to hold approximately 58% of the global potassium carbonate market share.
As per ChemAnalyst Analysis, "As potash stocks decline due to a supply shortage, the price of potassium carbonate in China's market skyrockets. Further, soaring demand from downstream detergent and agrochemical industries is projected to keep prices elevated.”