At present, the soda ash industry has shown signs of bottoming out, and the market has also formed expectations for the soda ash industry to warm up. Analysts said that the current sales of soda ash products have less profit, and the operating rate is above 80%. The worst time has already passed, but there are still differences in opinions as to whether or not it can fully recover during the year.
The worst time has passed
At present, the prosperity of the soda ash industry is at a low level, but analysts say that the industry's worst time has passed and the actual situation is not as bad as the market imagined.
According to data provided by Pan Xiaoli of the China Chemical Network Information Center, the current price of light soda ash is 950 yuan/ton-1150 yuan/ton, and the price of heavy soda ash is 1200 yuan/ton-1300 yuan/ton. According to this price, sales of products still have less profit.
Shi Yifeng, an analyst at CBI, said that different companies have different production processes that result in different costs, and the ammonia-alkali process is relatively high. The combined alkali process is relatively low. Therefore, Shuanghuan Technology, Huachang Chemical and other companies' soda business should have high profit margins.
It is understood that Sanyou Chemical Soda's operating rate is 80%-90%, the second quarter has been higher than the first quarter, exports stabilized at about 20% of production, inventory is not large. The company currently adopts a strategy of adjusting sales according to market conditions and adjusting it at any time in an effort to keep inventory to a minimum. According to industry insiders, soda ash companies are cautiously considering that most of them use the method of selling to set production, and the excess supply is not serious.
Soda ash exports rose steadily. Zhang Xiaohui, a researcher at Guoyuan Securities, said that the export volume of soda ash in the first half of this year was 1.28 million tons, which was an increase of 24% from the 1.03 million tons in the same period of the previous year. In terms of months, only the exports in May decreased year-on-year, and the remaining months increased year-on-year. However, the export price is low and it is in a state of low profit.
Warming of the industry's warmer <br> For the soda industry's warming, one view is that the upstream industry flat glass of soda ash has been revived under the drive of real estate, and it is expected that the soda ash industry will be warmed up by the end of this year.
According to statistics, real estate is one of the largest downstream terminals in the soda industry. The flat glass industry is directly downstream of soda ash. About 42% of China's soda ash is used to produce glass, and nearly half of glass is used in the real estate industry. The growth of real estate investment and the recovery of flat glass have brought hope for the soda industry's warming.
Data show that from January to July, the total investment in real estate development in China reached 1772.0 billion yuan, an increase of 11.6% year-on-year. In June, the area of ​​new housing starts was 479 million square meters, an increase of 54.43% compared with the previous period; July was 550 million square meters, an increase of 14.8%.
The Industrial Securities research report stated that float glass rebounded sharply in March of this year, flat glass has seen a full recovery in the second quarter, and 43 production lines that have been discontinued in the second half of the year may resume production. The late developers will speed up construction, and the huge area under construction will create continuous new demand for glass.
Northeast Securities said that the production of flat glass is the leading indicator for the soda industry, and the production of soda lags behind the glass industry for about five months. National Securities analyst Xu Yongchao said that after two consecutive months of decline, flat glass production in June increased by 11% from the previous month, and the company's inventory has been digested.
However, another view is that while flat glass will drive the soda ash industry, due to excess capacity and high supply pressure in the soda ash industry, it is difficult to turn it on.
CBI analyst Shi Yufeng said that after the fourth quarter of 2008, China's soda ash production capacity expanded rapidly, and the overcapacity situation was still more prominent than idle capacity. Domestic demand for flat glass alone was not enough to drive the industry to warm up during the year.
Zhong Lin Securities researcher Li Linlin estimates that the apparent consumption of soda ash was approximately 16.15 million tons in 2009, a year-on-year decrease of 3.27%; excess production capacity was approximately 565 million tons, which accounted for approximately 26% of the production capacity in the same period. Even if transferred to the current export market, it is difficult to digest. . According to the statistics, a large number of soda ash projects will be put into production by the end of 2010 and will form production in 2011.
Exports of soda ash also face the double blow of anti-dumping in India and the US price cuts. Zhongyuan Securities's research report stated that China's soda ash exports accounted for 10% to 20% of total output. In January, China's single-month soda ash exports bottomed out; in March, it reached a new high in the first half of the year, at approximately 280,000. Ton, up 59% year-on-year and up 32% month-on-month. In order to protect local companies, on April 21, India imposed a temporary protection measure tax of about 20% on soda ash originating in China.
In response to China's low-cost exports, soda ash companies also adopted a strategy to export at lower prices. Analysts said that because American companies use natural alkaloids, they have lower costs. In July, the cif price of Southeast Asia soda ash was only US$170-180/ton, which made China's soda ash business almost no profit, while US companies did not.
Li Linlin believes that in the second half of the year, the possibility of the BDI index remaining at a low level is still relatively high. The cost of the soda ash exported from the United States to Southeast Asia is unlikely to rise significantly, and the possibility that US companies continue to maintain low-price exports is greater. The export prices of soda ash in China are still difficult to effectively rise. The recovery of domestic soda ash prices is also unfavorable.
The worst time has passed
At present, the prosperity of the soda ash industry is at a low level, but analysts say that the industry's worst time has passed and the actual situation is not as bad as the market imagined.
According to data provided by Pan Xiaoli of the China Chemical Network Information Center, the current price of light soda ash is 950 yuan/ton-1150 yuan/ton, and the price of heavy soda ash is 1200 yuan/ton-1300 yuan/ton. According to this price, sales of products still have less profit.
Shi Yifeng, an analyst at CBI, said that different companies have different production processes that result in different costs, and the ammonia-alkali process is relatively high. The combined alkali process is relatively low. Therefore, Shuanghuan Technology, Huachang Chemical and other companies' soda business should have high profit margins.
It is understood that Sanyou Chemical Soda's operating rate is 80%-90%, the second quarter has been higher than the first quarter, exports stabilized at about 20% of production, inventory is not large. The company currently adopts a strategy of adjusting sales according to market conditions and adjusting it at any time in an effort to keep inventory to a minimum. According to industry insiders, soda ash companies are cautiously considering that most of them use the method of selling to set production, and the excess supply is not serious.
Soda ash exports rose steadily. Zhang Xiaohui, a researcher at Guoyuan Securities, said that the export volume of soda ash in the first half of this year was 1.28 million tons, which was an increase of 24% from the 1.03 million tons in the same period of the previous year. In terms of months, only the exports in May decreased year-on-year, and the remaining months increased year-on-year. However, the export price is low and it is in a state of low profit.
Warming of the industry's warmer <br> For the soda industry's warming, one view is that the upstream industry flat glass of soda ash has been revived under the drive of real estate, and it is expected that the soda ash industry will be warmed up by the end of this year.
According to statistics, real estate is one of the largest downstream terminals in the soda industry. The flat glass industry is directly downstream of soda ash. About 42% of China's soda ash is used to produce glass, and nearly half of glass is used in the real estate industry. The growth of real estate investment and the recovery of flat glass have brought hope for the soda industry's warming.
Data show that from January to July, the total investment in real estate development in China reached 1772.0 billion yuan, an increase of 11.6% year-on-year. In June, the area of ​​new housing starts was 479 million square meters, an increase of 54.43% compared with the previous period; July was 550 million square meters, an increase of 14.8%.
The Industrial Securities research report stated that float glass rebounded sharply in March of this year, flat glass has seen a full recovery in the second quarter, and 43 production lines that have been discontinued in the second half of the year may resume production. The late developers will speed up construction, and the huge area under construction will create continuous new demand for glass.
Northeast Securities said that the production of flat glass is the leading indicator for the soda industry, and the production of soda lags behind the glass industry for about five months. National Securities analyst Xu Yongchao said that after two consecutive months of decline, flat glass production in June increased by 11% from the previous month, and the company's inventory has been digested.
However, another view is that while flat glass will drive the soda ash industry, due to excess capacity and high supply pressure in the soda ash industry, it is difficult to turn it on.
CBI analyst Shi Yufeng said that after the fourth quarter of 2008, China's soda ash production capacity expanded rapidly, and the overcapacity situation was still more prominent than idle capacity. Domestic demand for flat glass alone was not enough to drive the industry to warm up during the year.
Zhong Lin Securities researcher Li Linlin estimates that the apparent consumption of soda ash was approximately 16.15 million tons in 2009, a year-on-year decrease of 3.27%; excess production capacity was approximately 565 million tons, which accounted for approximately 26% of the production capacity in the same period. Even if transferred to the current export market, it is difficult to digest. . According to the statistics, a large number of soda ash projects will be put into production by the end of 2010 and will form production in 2011.
Exports of soda ash also face the double blow of anti-dumping in India and the US price cuts. Zhongyuan Securities's research report stated that China's soda ash exports accounted for 10% to 20% of total output. In January, China's single-month soda ash exports bottomed out; in March, it reached a new high in the first half of the year, at approximately 280,000. Ton, up 59% year-on-year and up 32% month-on-month. In order to protect local companies, on April 21, India imposed a temporary protection measure tax of about 20% on soda ash originating in China.
In response to China's low-cost exports, soda ash companies also adopted a strategy to export at lower prices. Analysts said that because American companies use natural alkaloids, they have lower costs. In July, the cif price of Southeast Asia soda ash was only US$170-180/ton, which made China's soda ash business almost no profit, while US companies did not.
Li Linlin believes that in the second half of the year, the possibility of the BDI index remaining at a low level is still relatively high. The cost of the soda ash exported from the United States to Southeast Asia is unlikely to rise significantly, and the possibility that US companies continue to maintain low-price exports is greater. The export prices of soda ash in China are still difficult to effectively rise. The recovery of domestic soda ash prices is also unfavorable.
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