US soda ash market tight on strong exports, demand

HOUSTON (ICIS)–Between strong exports the first three months of this year and healthy domestic demand, US soda ash producers are tight on supply, market sources said on Tuesday.

Market participants agree that US soda ash exports were strong in February and March, although statistics published by the US Census Bureau for those months are not yet available. The higher export volumes were the result of a major soda ash plant outage in China at the beginning of February.

On 1 February Chinese producer Shandong Haihua shut down its 3m tonnes/year soda ash complex at Weifang, Shandong province, due to leakage issues caused by severe winter conditions. The producer has two plants at the site, one with a capacity of 1.2m tonnes/year, and the other with a capacity of 1.8m tonnes/year.

The smaller plant was restarted on 27 February and is operating at full capacity. The larger plant was initially expected to be down up to six months, but the plant began operating at the end of April at around 50% of capacity.

However, even before the larger plant resumed operations, the Chinese market was no longer short on supply, sources say. As a result, US soda ash exports in April were expected to have dropped from levels seen in February and March.

The domestic market is a fully contracted portfolio, one producer said. And stronger exports this year have reduced supply. Stocks at the end of February at 309,000 tonnes were down by 15% from the same month a year ago.

North American soda ash producers include Ciner Resources, Industria del Alcali, Searles Valley Minerals, Solvay Chemicals, Tata Chemicals and Tronox.