Chinese raw material woes boost US soda ash competitiveness

01 April 2005 23:12  [Source: ICIS news]

HOUSTON (CNI)--Increases in the price of raw materials for soda ash in China have boosted the competitiveness of the US soda ash business, major western producer Solvay told CNI on Friday.

 

The rising price of salt and other materials coupled with an increased domestic demand has significantly reduced exports from China and led to improved profitability for US producers following a prolonged downturn.

 

“Between higher costs and an eventual revaluation of the Chinese currency; we believe the US industry is again quite competitive in the world market,” said Dick Hogan, executive vice president of Solvay Chemicals Inc., in an interview with CNI. “This was sorely needed as our costs are up as well, primarily due to energy and transportation, which is forcing us to raise prices to get back margins lost over a seven year bear market.”

 

Elevated Chinese feedstock costs are expected to continue for some time, according to Marcie Peters, business director of soda ash for Solvay Chemicals. “It doesn’t look like the situation is going to turn around any time soon.”

 

Solvay sees the global soda ash market growing at around 2% a year, with any further growth restricted by product availability.

By: Robert Brown
+1 713 525 2653

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