The Caustic Soda Price Trend Saw an Upward Rally in the Global Market
- 01-Feb-2023 12:31 PM
- Journalist: Patrick Knight
The Caustic Soda price trajectory witnessed a surging momentum owing to the increment in the demand from downstream industries, such as the alumina and detergent industry in the global market. Moreover, the US Caustic Soda market has been affected by the production cut in January in Covestro (Texas) amid high input cost inflation with rising energy prices in mid-January.
European Caustic Soda price trend saw a bullish market situation in the last week of January 2023, backed by the increasing domestic offers from the downstream alumina and detergent industry coupled with limited availability of stocks. The strong profit margins in the domestic market, in line with the firm number of Caustic Soda shipment contracts for 2023, led to the northward price movement of the commodity in Europe. Meanwhile, as per the latest insights, chemical companies Covestro and LANXESS are collaborating in the energy-intensive production of basic chemicals, including Caustic Soda, at their Lower Rhine sites in Germany by sourcing these products with a significantly reduced carbon footprint and making them climate-friendly.
In the USA, consistent consumption of Caustic Soda in the Alumina industry and lower inventories amidst capacity reduction due to the Force Majeure in Covestro at Texas (USA) from 1 January 2023 to 20 January 2023 impacted the price trend of Caustic Soda in the week ending 20 January 2023. As a result of January's force majeure, Covestro presently holds an active capacity of 9935 TPM from the total capacity of 28000 TPM in mid-January. Presently, the improvement in the supplies in line with the rebound in the production activities and consistent domestic market demand supported the stability in the Caustic Soda prices in the US market in the week ending 27 January 2023.
According to ChemAnalyst prediction, "Caustic Soda prices are likely to surge in the global market in February due to further growth in the end-user detergent and alumina industries. At the same time, Caustic Soda prices are likely to be influenced by the bullish market sentiments in the US downstream sector coupled with the anticipated reduction in the product's capacity amid winter season in primary Caustic Soda producing Chemical Plants in North America."