Global Sodium Bicarbonate Prices Set to Surge in October 2023 Amid Rising Raw Material Costs
- 05-Oct-2023 2:18 PM
- Journalist: Jacob Kutchner
Sodium Bicarbonate prices are expected to rise worldwide in October and in the future. This price increase mirrors the trend seen in the previous month when Sodium Bicarbonate prices started to climb again. This renewed price increase can be attributed to various factors, such as higher costs for raw materials, increased manufacturing expenses, higher production levels, growing market demand, and a noticeable shortage in supply.
The pricing trend for Sodium Bicarbonate has shown remarkable strength recently. This can be attributed to two main factors: firstly, there has been a significant reduction in the supply of Sodium Bicarbonate from manufacturers, and secondly, the primary raw material for Sodium Bicarbonate, soda ash, has seen a substantial increase in its prices. The pricing of soda ash, the key ingredient, has remained resilient, with stable operational capacity and a moderate trade environment. Recent developments indicate a growing demand for downstream soda ash products, which is expected to increase the supply-demand balance. As a result, a predominantly strong trajectory is anticipated in Sodium Bicarbonate pricing shortly, contingent on downstream market demand, which may lead to price appreciation.
Regarding demand trends, important industries such as pharmaceuticals, textiles, and food have strongly preferred Sodium Bicarbonate. As a result, this has contributed to a more positive outlook for shipping, surpassing previous periods. Additionally, the rise in Sodium Bicarbonate prices can be attributed to manufacturers facing constraints in meeting the high demand. With the start of the new quarter, domestic and global businesses are expected to make substantial bulk orders to restock their inventories, further boosting market confidence.
Using raw materials, particularly Soda ash, showed positive signs in the business environment. As of October 1st, market conditions were favorable for trade, with data indicating that soda ash production was operating at approximately 81% of its capacity. It's worth noting that the price of soda ash is expected to increase. Several businesses conducted maintenance activities, resulting in a restricted soda ash supply and delayed delivery schedules. Additionally, data suggests that soda ash manufacturers have an inventory of around 140,000 tons, while enterprise inventories are relatively low. As a result, procuring soda ash in the market has become challenging due to the scarcity of available goods, further impacting Sodium Bicarbonate prices.
Analysts expect China's third-quarter crude oil imports from Saudi Arabia to remain slow due to China using its previously accumulated reserves strategically in response to reduced purchases by refiners. This drop in buying was triggered by oil prices exceeding $80 per barrel, primarily due to supply constraints imposed by the OPEC+ coalition, including OPEC and Russia. In the U.S. market, Sodium Bicarbonate prices notably increased, attributed to the summer spike in crude oil prices resulting from a supply-demand imbalance, especially during the U.S. summer driving season ending on October 1st, and demand from Latin America. Concurrently, OPEC, led by Saudi Arabia and in partnership with Russia, implemented production cuts to align production with demand, particularly focusing on meeting China's demand, which had not fully recovered from the COVID-19 pandemic.