Galaxy Futures: The caustic soda market is tightly balanced between supply and demand, with prices rising and corporate profits improving

Caustic soda shows a volatile trading trend.

On the supply side, the capacity utilization rate of sample enterprises has fallen to 85.3%, with weekly output of 844k tons; both measures have declined month-over-month. Multiple sets of units in Tianjin, Hubei, Guangxi, and other regions are undergoing concentrated maintenance, effectively easing supply pressure.

On the demand side, operating rates for alumina and viscose staple fiber have risen slightly. Steady demand from core needs provides stable support, and apparent demand has increased to 861k tons. As a result, the supply-demand situation has shifted from a loose balance to a slight tight balance.

In terms of inventory, stocks at national sample plants are 534k tons, down 3.86% month-over-month. The stocking capacity ratio has fallen back, and destocking in major sales regions such as North China, East China, and South China has been evident.

On prices, the weekly average in Shandong is 651 yuan/ton for 32% liquid caustic soda and 1,118 yuan/ton for 50% liquid caustic soda. Solid caustic soda prices have also risen in parallel, with standout increases in East China and Central China.

On the cost side, raw salt prices remain stable. Chlor-alkali enterprises’ gross margin has turned positive from negative to 205 yuan/ton, and profitability has improved significantly.

In the short term, ongoing maintenance and active export inquiries will continue to support the market. Key factors to track include the execution of export orders and the actual procurement pace in downstream sectors. (Galaxy Futures)