Throughout January of 2026, US caustic soda pricing was held steady through balanced availability and continued portability. The fact that these facilities were permanently closed by both Westlake Chemical and Olin did not have a significant impact on the market. The increase in trucking activity and higher freight charges would allow a sustained level of delivery pricing, but the overall volume of demand from the manufacturing sector remains weak. Conversely, the Chinese market for caustic soda has continued to drop due to an overabundance of supply and limited demand from downstream users. Almost all suppliers operate at their typical production levels of production, while purchasers of alumina only buy as they need to. Analysts do anticipate that US prices will remain stable in the near term while the Chinese market will continue to remain weak because of an overabundance of caustic soda and the lack of a strong demand recovery.
US caustic soda prices maintained their stability during late January 2026 because supply conditions operated at balanced levels while logistic operations continued to function at their usual efficiency. In China, price levels began to decrease because of sufficient product availability which resulted in decreased customer interest from downstream markets.
The US caustic soda market maintained its existing state after the announcement of permanent facility closures which took place earlier in the month. The Lake Charles site of Westlake Chemical permanently shut down a 120,417-ton unit while Olin Corporation shut down a 243,167-ton facility in Freeport. Caustic Soa market participants observed that the shutdowns only had a minor effect on operations because US supply levels remained adequate and inventory levels reached equilibrium. Producers maintained supply operations at proper levels which resulted in steadiness for Caustic Soda market pricing.
The distribution network maintained its smooth operations which helped to keep Caustic Soda prices constant throughout the entire period. The American Trucking Associations (ATA) reported a slight increase in trucking activities during December compared to November which resulted in the seasonally adjusted For-Hire Truck Tonnage Index increasing from 112.4 to 112.9. The index grew by 0.9% compared to the previous year which showed some level of stabilization following prior decreases. The freight growth for the entire year reached only 0.1% which demonstrated the ongoing decline in both manufacturing and construction sectors.
Trucking operations continue to experience restrictions because of insufficient available capacity. The Trucking Conditions Index (TCI) improved to 2.14 in November from 0.89 in October, driven by stronger freight rates and better capacity utilization. The chemical industry uses trucking for almost 60% of its domestic delivery operations which enables higher freight rates to sustain caustic soda delivery prices despite low overall market demand. The Midwest experienced weather disruptions during early December which caused freight demand to accumulate until January thus creating temporary support for logistics operations.
The Chinese caustic soda market experienced a downturn during the same period. Last week, all key regions experienced a decrease in prices. Chinese supply levels remained excessive because most producers operated at their standard rates while their inventory levels only decreased slightly.
Chinese Caustic Soda markets showed low interest in purchasing downstream products. Northern buyers purchased aluminum only when absolutely necessary before the upcoming Spring Festival period while alumina producers showed no interest in purchasing the product. The existing weather conditions together with reduced stockpiling activities have led to a situation which maintains the current state. The analysts predict that the alumina market will exhibit continuous downward movement which will limit the demand for caustic soda.
As per ChemAnalyst, US caustic soda prices will maintain their current level because supply levels remain balanced while logistics expenses stay stable. The market in China will experience Caustic Soda price weakness because of high supply levels and slow recovery of downstream customer demand.
