Quarterly price review for Caustic Soda flakes in India – 28 Mar 2014

The basic price of domestic manufacturers for Caustic Soda flakes jumped as high as 36% over with the last three months, primarily due to international turnarounds. In this review, Indianpetrochem provides a bird’s-eye view on the price and the market dynamics for Caustic Soda in the country over the last quarter.

Within the past three to four months the price of Caustic Soda has moved vicariously in the Indian markets due to the international turnarounds, specifically in China, which has influenced domestic manufactures to spike their basic price significantly.
 

Three months ago while the demand for the chemical was steady in major Indian markets, domestic players like GACL priced the ex-factory price of Caustic Soda within the range of Rs. 1,600- 1,700 exclusive of VAT (inclusive of excise of Rs. 110 and 120), for 50 kg bag, while imported Caustic Soda from was priced at Rs. 1,450 of VAT (inclusive of excise of Rs. 80 and Rs. 90), for 50 kg bag. Around the same time, Indianpetrochem gathers from various sources, that there were four plant shutdowns in China which caused a dip in imported supplies for the chemical.

A trader recollects and informed the website, “When there were four plant shut downs in China, GACLs supreme grade Caustic Soda’s basic price reached Rs. 2,200 (exclusive of VAT). Shortly thereafter, two plants resumed operations, which pulled down the basic price to Rs. 2,150 (exclusive of VAT)”.

Presently, the website notes that GACLs Ex- Factory is at Rs. 2,100 (exclusive of VAT),which usually is referred to as supreme grade, while raymond grade Caustic Soda sold by companies like Aditya Birla Group sells at Rs. 2,050 (exclusive of VAT).

In this perspective, a trader informed the website, “ there are no stock supplies of Chinese imports in the market, however it’s interesting to note that domestic production is at full swing and there are ample domestic goods in the market, amidst weak demand trend noted on account of year end closing”.

Eventually, there is a market expectation that prices for the chemical are going to dwindle further on account of existing weak demand trend and as more domestic products hits the markets in the near term.