07 March 2013 12:00 [Source: ICIS news]
LONDON(ICIS)--Western African solid caustic soda trade flows have been altered by Chinese exporters undercutting European sellers, a European trader said on Thursday.
"Because the Chinese are importing loads of cheap caustic soda, we cannot really compete, so we exited the market along with other European sellers," the trader said.
This tendency started in the early 2000s, but in the past couple of years has become very noticeable, the trader said.
This was echoed by a European seller which said it has not sold solid caustic soda to western Africa for months because it cannot compete with Chinese rivals and because it does not have the necessary volumes to export.
"I only sell a couple of containers a month now to my core, most loyal customers that need high quality material for food and drink production," the producer said.
The trader added: "Most buyers in Africa are not that worried that they might get lower-quality material as they use it for products where they will also do the job."
A Taiwanese producer said that it has kept most of its customers, despite its Chinese rivals, because its packaging is stronger and it is supplying niche markets where they need to make sure the caustic soda, used for example for bottle cleaning, is the best quality.
Chinese solid caustic soda is offered at $575/tonne (€443/tonne) cost and freight (CFR) Nigeria or Ivory Coast, whereas European-origin material is traded in the high $700s/tonne and low $800s/tonne CFR Nigeria or Ivory Coast, the trader said.
($1 = €0.77)
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