Eastern African solid caustic soda prices drop $10-30/tonne

06 June 2013 16:28  [Source: ICIS news]

LONDON (ICIS)--Eastern African caustic soda flake prices have dropped by $10-30/tonne (€7-23/tonne) to $500-510/tonne cost and freight (CFR) Mombasa, because of weak demand and lengthy supply conditions, sources said on Thursday.

One seller in India has received bids at $495/tonne CFR Durban and CFR Kenya, but it has not agreed on a sale yet as it considered this bid too low. 

Buyers in Kenya said that demand from the soaps, detergents and paper industries seems to be slowing and prices could further decline if offtake does not improve. 

Liquid caustic soda prices in Kenya are at $560-575/dmt CFR Mombasa, the lower end of the range representing Middle Eastern-origin, while the higher end of the range being Indian-origin material. 

Solid caustic soda flakes are at $500-510/tonne CFR Durban, and a number of sources thought this is the bottom of the market. 

There is a lot of resistance from Indian sellers to further lower prices, although Chinese producers still seem to be keen to offer discounts to shift material. 

A major distributor expects prices will move little in the next two months and the length will disappear as Asian caustic soda producers will cut output by shutting down for maintenances. 

The biggest problem for caustic soda producers is that chlorine consumption is low, and so they have cut chlorine output. Chlorine is a co-product of caustic soda and when chlorine output is cut, caustic soda production is also reduced.

($1 = €0.76) 

17th World Chlor-alkali Conference
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Follow Janos Gal on Twitter @janosgalICIS

By: Janos Gal
+44 208 652 3214

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