Caustic price hikes to lift ECU value

05 February 1994 00:00  [Source: ICB]

THE US caustic market appears to have swung from the oversupplied situation which led to first half alumina contracts being agreed as low as $25-30/tonne to what is now described as 'balanced to tight'. Plant closures at LCP's Brunswick site and, on 21 April, Atochem's Tacoma facility have removed some 180 000 tonne/year production from the market, minimal in terms of the 11m tonne/year US chlorine market.

First quarter 1994 US caustic demand is only 1% ahead of 1993 but this, added to maintenance turnarounds at three major producers' chlor-alkali units and reduced production at the Oxychem plant following the March explosion, has helped to offset the 715 000 tonne/year startup of the Formosa plant.

Producers are now seeking to lift electrochemical unit (ECU) values by pushing for a straight hike in caustic of $25/short dry tonne from 1 May. Spot numbers are said to be fluctuating wildly with prices out of the US Gulf and in European markets between $80-100/tonne.

Elf Atochem North America has closed the 77 000 tonne/year chlorine and 85 000 tonne/year caustic facility at Tacoma from 21 April. Sodium chlorate production at the site will continue.

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