ShouChuang Futures: Overseas installations reduce burdens, export expectations increase, caustic soda futures hit the daily limit for the second consecutive trading day

On the supply side, Korea and Indonesia’s chlor-alkali operations have decreased, leading to a reduction of nearly 300k tons in caustic soda supply. Domestically, recently, prices of liquid chlorine and caustic soda in Shandong have risen, and the overall profit margin of chlor-alkali has recovered, driving an increase in chlor-alkali capacity utilization. In March, a concentrated maintenance plan for domestic chlor-alkali plants has been implemented, which will reduce effective industry supply, and market expectations for caustic soda inventory reduction have strengthened.
On the demand side, non-aluminum downstream industries are gradually resuming work after the holiday, with marginal improvement in liquid alkali demand. Additionally, in March, ore prices at the raw material end for alumina are relatively weak, and the industry’s loss situation may improve. It is expected that alumina plant operation rates will slightly increase in March, and new alumina capacity will be gradually put into production from March to June, increasing raw material procurement demand.
Overall, overseas chlor-alkali plants are reducing capacity utilization, leading to decreased caustic soda supply, which may boost China’s caustic soda exports. Domestic downstream alumina new plants will come into operation, benefiting domestic demand. Caustic soda futures prices are experiencing valuation recovery, with attention to the progress of new downstream capacity releases and overseas plant changes. (First Capital Futures)