The inventory of soda ash market is surplus, and the maintenance policy is favorable and stimulating. In 2024, 6 million tons of new production capacity will be released.

[Soda soda market welcomes "antihypertensive drugs"]

Since the Spring Festival, the commodity market has frequently become hot spots, and agricultural products, non-ferrous metals and precious metals have taken turns to stage. Recently, coal and iron ore in the black building materials sector have also begun to show their heads. In this context, the soda ash market has also ushered in "antihypertensive drugs", which ushered in Xiaoyangchun under the stimulation of maintenance.

Since the third quarter of last year, the oversupply of soda ash market has become the core contradiction. The supply pressure brought by the commissioning of the new plant makes it difficult to reverse the trend of excess inventory of soda ash. At present, the soda ash market is in a state of "hypertension", and the supply pressure will continue to increase in the future. Although the planned production capacity in 2024 is lower than that in 2023, the total production capacity of 6 million tons in Alashan Phase I Line 1-3 and Jinshan Phase V will be released in 2024. In addition, in the second and third quarters of this year, the soda ash industry will also face the commissioning of 1 million tons of new plants from Fufeng, Debon and Xiangyu Salt Chemical, and the supply pressure will continue to increase.

Although the soda ash industry is facing supply pressure, the market pressure can be effectively alleviated by exceeding the expected maintenance. The recent increase in the price of soda ash is mainly affected by the unexpected reduction of Fengcheng, Jinshan, Ammonia Alkali Source, Longshan, Alashan, Junhua, Yongli, Nanfang Alkali Industry and Hongsifang. At the same time, the favorable stimulus of policies, such as fully ensuring the timely and quality delivery of real estate projects under construction, and starting construction of additional national debt projects before the end of June this year, also boosted market sentiment.

However, the long-term "high blood pressure" trend of soda ash market is difficult to reverse unless the industry makes deep adjustment. The marginal effect brought by maintenance is gradually weakening, and the supply pressure in the future is still relatively large. As a peak season contract, 09 contract is stimulated by favorable factors such as maintenance, and it is easy to go up and down in the short term, which is more suitable for bargain hunting. But in the long run, the soda ash market will still face downward pressure.

When investors participate in the soda ash market, they should pay attention to factors such as supply pressure, policy changes and industry adjustment, rationally analyze market trends, and make investment decisions cautiously.