5.12 Soda Ash Daily Review: Supply contraction and high inventory pressure caused the soda ash market to consolidate
Soda ash market analysis
Today, the domestic soda ash market is sideways. As of now, the price of light soda ash in Central China is 1280-1390 yuan/ton, and the price of heavy soda ash is 1300-1450 yuan/ton; the price of light soda ash in North China is 1400-1500 yuan/ton, and the price of heavy soda ash is 1460-1550 yuan/ton. Recently, the supply side of the soda ash industry has shrunk. Shilian Chemical and Henan Jinshan have entered the maintenance state, and the overall operating load of the industry has decreased.
However, due to the previous inventory backlog, the total inventory of soda ash manufacturers remains high, which suppresses prices. The demand side is flat, and the company's new orders are average, mainly to digest the existing orders.
Downstream procurement is cautious, and the market trading is mainly based on small orders for rigid demand, and the willingness to replenish inventory is low. Although there is some demand in the float glass industry, the overall trading atmosphere is tepid.
Soda ash index analysis
According to Boduoduo data, the price index of light soda ash on May 12 was 1338.57, and the price index of heavy soda ash was 1371.43, which was the same as the previous working day.
Futures dynamics
According to Boduoduo data, the opening price of the main soda ash contract SA2509 on May 12 was 1299 yuan/ton, and finally closed at 1318 yuan/ton, with a daily increase of 0.15%. The highest intraday price was 1324 yuan/ton, the lowest was 1285 yuan/ton, and the total position was 1233186 lots, an increase of 11751 lots month-on-month.
Today, the soda ash futures price bottomed out and rebounded. On the one hand, it was driven by the overall macro sentiment after the results of the Sino-US tariff negotiations exceeded market expectations. On the other hand, the equipment failures and maintenance problems of the two major factories flowed out over the weekend, and some short funds mainly hedged and realized profits.
The current soda ash market is gradually entering a concentrated maintenance period, and there may be a period of negative supply and demand gap in the future. However, given that the inventory in the middle and upper reaches is still high, coupled with the tepid downstream demand, the actual impact may be relatively limited, and the weak fluctuations will be maintained for the time being, waiting for the maintenance to be realized.
Market forecast
On the whole, the current soda ash market presents a weak supply and demand pattern: although the maintenance of some units has led to a contraction in the supply side, the market price has limited room for upward movement due to the suppression of high inventory and continued weak downstream demand. In the short term, the market may maintain a volatile trend, and it is necessary to focus on the progress of subsequent unit maintenance and marginal changes in actual downstream purchasing demand.
Data source: Boduoduo Data Group
