Olin Corporation Releases Quarterly Results, Expects Rise in US Caustic Soda Prices in the Second Quarter
World’s largest Chlor-Alkali producer, Olin has recently revealed its quarterly results wherein it has highlighted the muted performance of its Chlor-Alkali segment which pushed its quarter-over-quarter adjusted EBITDA, a little lower. The industrial decline is strongly reflected in the company’s fourth quarter Ethylene Dichloride, Caustic Soda and Hydrochloric Acid pricing. As compared to the fourth quarter of 2019, Olin’s Caustic Soda prices dived by 8 per cent during the first quarter of 2020. While, EDC witnessed 14% lower pricing, and Hydrochloric Acid pricing declined by approximately 25% as compared to the fourth quarter. However, the company anticipates prices to strengthen during the second quarter owing to a sharp fall in chlor- alkali operating rates which led to tightening of supply and demand balance which would support improved Caustic Soda pricing. The report reveals that US Chlor-Alkali rates were 86% in February which rose to 90% in March. However, amid destruction in demand due to lack of industrial operations and plant shutdowns, April rates declined to 70% to 80%, reflecting lower output. The company has announced that domestic Caustic Soda pricing indices increased by $20/tonne in April and it is expecting additional Caustic Soda price increases totaling $140 per ton for May and June. The tightness in supply is likely to continue till June, when Formosa Plastics shut its 736 KTPA Chlor-Alkali plant in Texas.