The Ciech Group is analyzing the possibilities of selling soda in China in spot transactions, due to their high prices, twice as high as in Europe, according to Adam Czarnul, the head of the soda business in the Ciech Group, and a member of the Management Board of Ciech Soda Polska.
“We are currently closely monitoring the situation in China – a country that accounts for roughly half of the consumption and production of soda ash in the world. In recent weeks, we have observed very dynamic price increases there, caused by the turmoil in the local economy – the prices of soda ash in spot transactions have increased to EUR 470 per ton, which is twice as high as on the European market. Overall, we see increased demand in many regions of the world, however, Asia has rebounded the most, while some new investments have been delayed by COVID. This disrupted the global balance of supply and demand, and the effects can be seen, among others, on the example of China and the local spot price of spot transactions, ”Czarnul said in an interview.
In his opinion, such a price level in China means for global soda producers the possibility of obtaining high margins, despite the growing costs of raw materials. The high prices of soda in China, less logistics costs, should in theory set the approximate price level in other parts of the world, including Europe. Margins on the local market will attract producers from all over the world, which will also have an impact on the regional soda markets: there will be additional pressure on a further increase in prices.