Chlorine and caustic soda production are a key indicator of economic growth. They have been produced in large volumes for over a century, and have a extremely wide range of uses from pharmaceutical and aluminium production to detergents and disinfection. The blog's mid-year review of European data from Eurochlor showed worrying signs of a slowdown, with chlorine production down 3% versus 2011 levels.
Full-year data shows that producers continued to act responsibly to avoid a repeat of the problems seen in early 2009:
• Total 2012 chlorine production was down 1.9%, following a 0.6% fall in 2011
• Operating rates remained low at an H2 average of 75.7%
• Even so, caustic soda stocks ended at 241KT versus 233KT in 2011
The key to success in H1 had been strong sales of PVC and caustic soda into export markets. This position continued in H2 on PVC, with net exports up 4% versus 2011 to October, based on data from Global Trade Information Services. But net caustic soda exports were down 23% to the end of October. And worryingly, the two largest country markets both slowed. PVC sales to Turkey were down 26% (100KT), and caustic sales to the US down 17% (30KT).
Update. On Friday, Ineos ChlorVinyls announded it was closing 3 PVC plants, and one chloralkali cellroom. CEO Chris Tane blamed the closures on "current and expected economic conditions impacting demand across Europe,"