Allen Zhang (CCAON- China) Lily wang (CCAON-China) +8622 2742 8231 -Tianjin +8610 64335599-637 allenzhang@ccaon.com lilywang@ccaon.com Nancy Hao (CCAON- China) Olivia Wang (CCAON- China) +8610 64335599-635 -Beijing +8610 6433 5599 -Beijing nancyhao@ccaon.com olivia@ccaon.com ISSUE NUMBER: 003 7 October, 20 CAUSTIC SODA (Page 1-13) Raw Material Domestic market Export market Downstream market Forecast Production news SODA ASH (Page 14) Domestic market Soda ash price monitoring Export Date HYDROCHLORIC ACID (Page 18) CHLORINE (Page 18) Published by: NOTE: Information contained in this report is obtained from sources believed to be reliable, however no responsibility or liability will be accepted by CCAON and Page 1 commercial decision claimed to have been based on the content of the newsletter. Reproduction of any part of this work by any process whatever without written permission of CCAON is strictly forbidden.
CAUSTIC SODA Raw Material: Industry salt market Price of industry salt was almost consolidating in September. Price of solar salt was at high level although there were some resistances from downstream producers. Lake salt producers tried their best to overcome transportation difficulties on offtakes. Most well salt producers took plant maintenance at the end of month due to the insipid downstream market. Prevailing prices Region Price Property RMB/mt Market movement Shandong ex-work 370-375 Solar salt Tianjin ex-work 320-340 Jiangsu ex-work 450-460 Hebei ex-work 390 Price of solar salt was almost consolidating in September. Demand for salt became insipid due to the down-ward downstream soda market. However, due to the little tight supply of salt cargoes, its price was almost consolidating with decline in some districts, Liaoning ex-work 450 Lake salt Inner Mongolia ex-work 230-300 Qinghai spot 180-200 Price of lake salt presented a stable level in September. Producers tried their best to overcome transportation difficulties to sell cargoes to other districts. Well salt Sichuan FD 450-460 Hunan & Hubei ex-work 420-440 Yunnan ex-work 370-400 Jiangsu spot 450-470 Price of well salt was almost stable in September, and there was some price rise in the middle ten days due to the increased coal cost. Most producers took plant maintenance in the end of month due to the insipid downstream market. Domestic market DOMESTIC PRICES OF LIQUID CAUSTIC SODA Region Prevailing prices (RMB/ mt) D-30% Four weeks ago M-32% Four weeks ago Market movement Page 2
E.China 730-745 630-770 775-800 710-810 S.China 795 760-840 840-855 810-900 N.China 650-700 630-690 740-760 680-760 NW.China 480-535 520-550 570-625 610-640 NE.China 770-830 770-830 870-900 870-900 SW.China 680-720 680-720 750-780 750-780 C.China 640-660 640-660 740-820 730-820 D-30%: Diaphragm grade 30% liquid caustic soda M-32%: Membrane grade 32% liquid caustic soda Price showed the upward trend in September due to the high production cost and low operating rate of local chlor-alkali producers. Price was almost stable with slight decline last month in S.China. Caustic price was almost consolidating in a limited range although there were some declines for RMB 20-30/mt in Shandong and Tianjin. Price of caustic soda continued to stay at high level in the first ten days of September due to the declined output. However, There was a drop in price in the last ten days due to the increased sale pressure from flake caustic soda process producers. Price experienced from stable to downward trend due to the gloomy downstream demand. Price of caustic soda was with the upward trend due to the low operating rate and declined output, although faced with stagnant demand from downstream producers. Price of caustic soda was at a high level due to the declined operating rate, which was caused by the insipid PVC market. 1000 Domestic prices of 30% caustic soda 900 Price(RMB/mt) 800 700 600 500 Date 1-Jan 11-Jan 21-Jan 31-Jan 10-Feb 20-Feb 1-Mar 11-Mar 21-Mar 31-Mar 10-Apr 20-Apr 30-Apr 10-May 20-May 30-May 9-Jun 19-Jun 29-Jun 9-Jul 19-Jul 29-Jul 8-Aug 18-Aug 28-Aug 7-Sep 17-Sep 27-Sep East Average South Average (Average prices from 1st Jan to 28th September) Page 3
Domestic prices of 32% caustic soda 1000 Price(RMB/mt) 900 800 700 600 500 Date 3-Jan 17-Jan 31-Jan 14-Feb 28-Feb 13-Mar 27-Mar 10-Apr 24-Apr 8-May 22-May 5-Jun 19-Jun 3-Jul 17-Jul 31-Jul 14-Aug 28-Aug 11-Sep 25-Sep E.China S.China (Average prices from 1st Jan to 28th September) DOMESTIC PRICES OF FLAKE CAUSTIC SODA Region Prevailing prices (RMB/ mt) 96% 99% The first week 3300-3600 3550-3700 E.China The second week 3100-3300 3250-3400 The third week 3100-3300 3250-3400 The last week 3100-3200 3250-3400 The first week 3300-3500 3600-3800 S.China The second week 3200-3400 3400-3600 The third week 3200-3400 3400-3500 The last week 3200-3300 3300-3500 N.China The month 3000-3300 3200-3500 NW.China The month 2500-2750 2650-3000 SW.China The month 3200-3550 3500-3800 Market movement Price declined in September due to the weak demand from downstream producers. Price declined evidently in Guangdong market but it was almost stable at a high level in Guangxi due to the healthy demand from downstream alumina market. Price declined slightly due to the insipid demand from downstream producers. Caustic soda producers faced the sale pressure, and price had declined last month. Price kept stable due to the declined output in SW.China. However, there was also a price decline in the last ten days due to the price decline influence from other districts. Export market Domestic producers restored the normal export in September after the Olympic Games. There were some new nominations for October came out in succession. Offer price was at USD 550/mt FOB from Shanghai producer, and conclusion price was at about USD 500/mt FOB. Jiangsu producer offered at USD 530/mt FOB, and Shandong producer offered lately at USD 500/mt FOB. Oct. conclusion price was between USD 450-550/mt FOB, which showed a large range. Marketers said that there were some uncertain elements increased between buyers and sellers for liquid caustic soda export market after Olympic Games, and export price followed to fluctuate too. Page 4
Export market of solid caustic soda presented the downward trend in September. Olympic Games has finished at the end of August, and export market restored in the first week of September. Export price of 99% flake caustic soda was between USD 520-550/mtFOB in the ports of Tianjin and Shanghai in the first week of September with stable conclusions. However, export price began to decline from the second week due to price decline in domestic market, and most foreign buyers maintained the wait and see attitude. Till the end of month, export price of 99% flake caustic soda slid to USD 490-520/mtFOB in Tianjin port with insipid conclusion. Indications were that the export nomination was almost stable at USD 550-560/mt DAF in southwestern frontier, and conclusion volume was limited. Export offer was declined from the original USD 480-500/mt DAF to USD 480/mt DAF with limited conclusions. EXPORT CAUSTIC SODA Main Harbor Class Low Top range range Sources from 98% FOB 500 550 Xinjiang Tianjin, Xinjiang, 99% FOB 490 560 Tianjin Ningxia 96% FOB 460 500 Inner Mongolia, Tianjin 48%-50% FOB 500 500 Tianjin 98% FOB 530 560 Anhui Shanghai 99% FOB 530 560 Anhui, Shanghai 96% FOB - - Shanghai 48%-50% FOB 500 500 Shanghai Northwest 99% DAF 480 500 Sinkiang 96% DAF 540 550 Guizhou, Sichuan Frontier Southwest 98% DAF 550 560 Guizhou, Sichuan Trade 99% DAF 550 560 Guizhou, Sichuan South 72% DAF - - - East 48%-50% FOB 500 500 Jiangsu Small South 48%-50% FOB ports RMB RMB Guangdong 1650 1700 Northeast 48%-50% FOB - - Liaoning North 98.5% FOB 510 530 Shandong CHINA LIQUID CAUSTIC SODA EXPORTS IN AUGUST 20 Volume Average prices To Source from Customs Tons USD/MT Macao Guangdong Gongbei 15 218 Liaoning Shenyang 8,904 219 Brazil Shandong Qingdao 12,724 225 Philippine Tianjin Tianjin 2,959 480 Page 5
Shanghai Shanghai 5,012 500 Jiangsu Nanjing 2,235 380 Zhejiang Ningbo 3,057 212 Shandong Qingdao 5,144 240 S. Korea Tianjin Tianjin 4,642 502 Shanghai Shanghai 2,450 491 Shanghai Shanghai 12,338 453 Canada Jiangsu Nanjing 7,1 380 Shandong Qingdao 25,561 234 United States Jiangsu Nanjing 10,136 4 Shandong Qingdao 21,471 265 Taiwan Tianjin Tianjin 1,912 530 Shanghai Shanghai 1,519 471 Hongkong Guangdong Jiulong 902 182 Singapore Tianjin Tianjin 3,973 480 Shanghai Shanghai 2,268 500 India Jiangsu Nanjing 5,897 480 Zhejiang Ningbo 6,058 236 Total 146,285 Note: * Marked information seems to be deviant All data sourced from CIQ Volume 250,000 200,000 150,000 100,000 Liquid soda export to key regions year 20 Aug Jul Jun May Apr Mar Feb Jan 50,000 0 Australia United States Canada India Taiwan Page 6
The volume and average prices of China's Export Liquid Caustic soda 20 Volume USD/MT 240,000 220,000 200,000 180,000 160,000 140,000 120,000 100,000 80,000 60,000 40,000 20,000 0 Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug 350 300 250 200 150 100 50 0 Volume Average prices Note: Average prices of Export Liquid caustic soda are calculated from General Trade. CHINA SOLID CAUSTIC SODA EXPORTS Aug Jan-Dec 20 Region Country Volume Tons Average prices USD/MT Volume Tons Average prices USD/MT America Argentina - - 72 340 Brazil - - 9,332 336 Panama - - 115 367 Puerto Rico - - 22 382 The Commonwealth of Dominica - - 95 372 Dominica 168 395 25 390 Ecuador - - 894 333 Canada - - 2,032 380 United States 216 659 12,496 373 Mexico 46 550 146 348 Colombia 696 532 2,546 338 Costarica 134 504 50 360 Cuba - - 1,794 436 Honduras - - 84 260 Peru 439 494 6,549 338 Nicaragua - - 177 348 El Salvador 75 580 250 360 Page 7
Africa Guatemala 114 560 161 367 Trinidad and Tobago - - 91 384 Venezuela - - 273 349 Jamaica - - 159 346 Chile 165 613 2,786 340 Total 2,053 40,149 Algeria - - 88 418 Egypt 96 404 3,002 341 Ethiopia - - 2,259 359 Angola - - 1,097 346 Benin - - 405 360 Burkina Faso - - 25 335 Togo - - 1,6 365 Congo - - 706 357 Eritrea - - 44 3 Gambia - - 475 338 Djibouti - - 1,734 332 Guinea - - 123 369 Ghana - - 4,591 361 Zimbabwe 20 595 259 350 Cameroon - - 467 394 Cote d'ivoire 75 574 778 393 Kenya 525 519 6,655 383 Gabon - - 22 410 Libyan - - 136 336 Liberia - - 25 385 Madagascar - - 1,023 379 Malawi - - 65 366 Mali - - 100 300 Mauritius 250 524 2,018 337 Mauritania - - 300 354 Democratic Republic of Congo - - 483 392 Morocco - - 137 335 Mozambique 456 457 10,017 338 South Africa 320 575 7,178 367 Niger - - 41 369 Nigeria - - 35,469 332 Namibia 2,800 546 3,959 344 Senegal - - 4,123 317 Suriname 100 250 528 359 Page 8
Europe Oceania Asia Somalia - - 25 360 Tanzania 150 543 15,881 355 Tunisia - - 286 343 Zambia - - 286 334 Chad - - 16 420 Total 4,792 106,433 Danmark - - 140 387 Deutschland - - 200 175 Russia 2,309 393 14,352 299 France - - 44 374 Czech Republic - - 20 345 Norway - - 22 375 Portugal 68 420 311 342 Ukraine - - 22 370 Spain - - 488 341 Sweden - - 40 405 Greece - - 156 418 Italy - - 88 321 Total 2,377 15,883 Australia 61 1,690 1,674 498 Papua New Guinea - - 396 362 New Zealand - - 186 411 Tonga - - 50 330 New Caledonia - - 48 398 Total 61 2,354 UAE - - 729 352 Oman - - 389 339 Macao 5 558 130 367 Pakistan - - 2,375 301 N. Korea 188 468 2,016 344 Philippine 635 514 5,879 341 Kazakhstan 281 450 9,966 280 S. Korea 280 505 4,291 341 Kyrgyzstan 52 500 1,462 288 Cambodia - - 232 372 Kuwait - - 10 490 Malaysia 275 397 2,858 322 Mongolia 58 260 1,061 226 Bangladesh 7,237 368 80,901 3 Myanmar 2,560 394 29,065 324 Nepal - - 60 424 Page 9
Japan 35 583 427 342 Sri Lanka 395 562 5,965 333 Sudan 470 512 13,156 313 Tajikistan - - 356 319 Taiwan 66 555 66 341 Thailand 650 426 7,781 331 Turkmenistan 223 375 4,099 299 Uzbekistan 8 424 10,417 295 Hongkong 95 532 1,648 356 Singapore - - 1,583 356 Syria - - 1,289 333 Yemen - - 4,4 345 Iran - - 14,156 347 Israel - - 20 340 India 142 647 8,387 354 Indonesia 936 445 3,165 336 Vietnam 3,120 512 64,161 332 Total 18,511 282,5 Others 950 527 1 Total 28,744 447,324 Note: * Marked information seems to be deviant All data sourced from CIQ The volume and average prices of China's Export Solid Caustic soda 20 Volume USD/MT 60,000 50,000 40,000 30,000 20,000 10,000 0 Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug 500 450 400 350 300 250 200 150 100 50 0 Volume Average prices Note: Average prices of Export Solid caustic soda are calculated from General Trade. Page 10
Downstream market Industry Production yield in August (10K DMT) Growth yr-on-yr(%) Alumina 215.6 24.4 Paper pulp 171.5-4.6 Novamat 10.8-14.1 Soap 7.3 3.1 Synthetic detergent 53.3-7.8 Forecast There might be another round of price fluctuation after the National holidays. Price might decline in N.China, and it might continue to stay at the high level in S.China. However, marketers said that there might be limited bull elements in the future market. Production news CHINESE CAUSTIC SODA PLANTS OPERATION (Unit: KDMT/Yr) Region Producer Status of Caustic Soda Plant Northeast China Jinhua Chemical Sep, run at about 70% Shenyang Chemical Sep, maintain low operating rate Tianjin Chemical Plant Sep, run at about 80% Tianjin Dagu Chemical Sep, run at about 70% N.China LG Bohai Chemical Sinopec Qilu Petrochemical Shandong Hengtong Chemical Sep, run at stable rate Sep, maintain low operating rate Tangshan Sanyou Chlor-Alkali Sep, run at about 80% Shanxi YuShe Chemical Inner Mongolia Haiji Chlor-alkali Weifang Yaxing Henan Shenma Chlor-alkali Sep, stop production C.China Haohua Yuhang Chemical Kaifeng Dongda Chemical Sep, run at about 70-80% Zhuzhou Chemical Sep, run at about 50% NW.China Ningxia Yinglite Chemicals Xinjiang Tianye Xinjiang Zhongtai Chemical Shaanxi Jintai Chlor-alkali Sep, operating rate was not full Sep, operating rate was not full E.China Shanghai Chlor-Alkali Sep, run at 50% Page 11
Taixing SP Chemicals Jiangdong Chemical Jiangsu Anpon Electrochemical Hangzhou Electrochemical Sep, operating rate was almost full July, run normally basically for the 110 kt/yr unit; Expansion by 60 kt/yr new unit in the middle ten days of July; Sep, run at about 90% Sep 23-28, stop for the 150 kt/yr membrane unit Zhejiang Juhua Group Sep, run at 60-70% Zhejiang Shangao Chemical S.China Nanning Chemical Southeast Electrochemical Sep, run at 70-80% SW.China Yibin Tianyuan Group Zigong Honghe Chemical Sichuan Jinlu Group Sep, run at about 50% for the unit in the new plant district Page 12
No Producer CAUSTIC SODA EXPANSION (unit: kt/yr) Caustic Soda Capacity Caustic Soda Expansion D G* M G* D G M G Update 1 Yibin Tianyuan Group 150 150 150 Sep, run at about 50% for the unit in the new plant district 2 Tangshan Sanyou Chlor-Alkali 100 100 Sep, run at about 80% 3 Two Lions (ZhangJiaGang)Fine Chemical Co.,Ltd. 150 150 4 Jiangdong Chemical 70 100 July, run normally basically for the 110 kt/yr unit; Expansion by 60 kt/yr new unit in the middle ten days of July; Sep, run at about 90% 5 Shandong Xinfa Chemical 250 6 Shandong Haihua Chemical 100 150 Sep, run at about 80% 7 Ningxia Yinglite Chemicals 100 8 Inner Mongolia Elion Chemical 360 Expansion by 360 kt/yr;/oct 28 in 20, start-up for 100 kt/yr unit,/late Dec in 20, start-up for another 100 kt/yr unit/ Others continue to be delayed Sep in 20, run at low operating rate 9 Haohua Yuhang Chemical 90 110 200 10 Shanxi Yushe Chemical 270 100 100 11 Henan Shenma Chlor-alkali 22 20 12 Nanning Chemical 100 120 40 13 Jiangsu Suhua 90 90 Sep, run at 70-80% 14 Sinopec Nanjing Petrochemical 60 100 15 Hubei Yihua Chemical 13 12 16 Jilantai Group 200 17 Taixing SP Chemicals 300 150 Sep, operating rate was almost full 18 Xinjiang Tianye 240 160 M3 Nov in 20, commissioning for 160 kt/yr membrane unit; / operating rate was not full 19 Xinjiang Zhongtai Chemical 250 100 M3 Nov, commissioning for 100 kt/yr membrane unit;/ Sep, operating rate was not full D G*: Previous capacity of diaphragm grade soda M G*: Previous capacity of membrane grade soda D G: Diaphragm grade M G: Membrane grade Page 13
SODA ASH Domestic market Domestic soda ash market sentiment was subdued and prices went down at large this month. Some soda ash producers increased capacity or built new capacity, so soda ash output increased sharply in September. However, soda ash downstream producers cut operating rates due to the Olympic Games. In order to reduce the high inventory, domestic soda ash suppliers conceded lower price, this was the director factor of falling prices. Affected by the global great depression, soda ash offtakes were bad. Downstream producers cut operating rates, for example papermaking, glass and washing-up. Analysts thought that soda ash prevailing prices would decrease in October. Average price Forecast L-Soda RMB/mt D-Soda RMB/mt Region market movement four weeks four weeks July July L D ago ago E.China 1887.62 1994.762 2064.29 2128.81 Supply exceeded demand, price decreased. S.China 2042.86 22.619 2192.86 2200 Price was stable in early September and then fell down. Tonnages with low price from N.China 1970.95 2027.381 2135.71 2180.952 C.China and NW.China flew into N.China. The price remained flat, but NE.China 2139.29 2191.667 2275 2275 downstream producers were subdued. SW.China 1915.95 2005 2105.95 2175 Price reduced slightly in September C.China 1859.29 1911.905 2039.29 2102.381 Tonnages from China flew into N.China. NW.China 1715.48 1750.476 1788.57 1810 Prices was at the lowest level, transportation condition was difficult. Note: 1 L-Soda: Light soda D-Soda: Dense soda 2 : stable, :slight increase, : slight drop, : sharp increase, : sharp drop Page 14
Soda ash price monitoring LIGHT SODA ASH E.China S.China N.China NE.China SW.China C.China NW.China Sep 4 RMB/mt 1870-1920 2000-2100 1850-2130 2100-2200 1950-2020 1900-1950 1600-1950 Sep 11 RMB/mt 1870-1920 2000-2100 1800-2130 2100-2200 1900-1950 1850-1950 1500-1800 Sep 22 RMB/mt 1880-1950 1950-2100 1950-2050 2100-2150 1850-1920 1750-1850 1650-1800 Sep 28 RMB/mt 1800-1950 1850-2050 1800-1960 2100-2150 1830-1900 1750-1850 1550-1700 DENSE SODA ASH E.China S.China N.China NE.China SW.China C.China NW.China Sep 4 RMB/mt 2050-2100 2150-2250 2050-2250 2250-2300 2150-2200 2050-2150 1670-1950 Sep 11 RMB/mt 2050-2100 2150-2250 2050-2250 2250-2300 2000-2050 2050-2150 1670-1800 Sep 22 RMB/mt 2000-2100 2150-2250 2100-2200 2250-2300 2100-2150 1950-2000 1670-1950 Sep 28 RMB/mt 2000-2100 2100-2200 2050-2150 2250-2300 2100-2150 1850-1950 1670-1850 Jan-Aug domestic soda ash average ex-work price trend diagram 2250 2200 2150 2100 2050 2000 1950 1900 1850 1800 1750 1700 1650 1600 1550 1500 2-Jan 8-Jan 14-J an 20-J an 26-J an 1-Feb 7-Feb 13-Feb 19-Feb 25-Feb 2-M ar 8-M ar 14-M ar 20-M ar 26-M ar 1 -A pr 7-A pr 13-A pr 19-A pr 25-A pr 1-M ay 7-M ay 13-M ay 19-M ay 25-M ay 31-M ay 6-Ju n 12-Jun 18-Jun 24-Jun 30-Jun 6-Jul 12-Jul 18-Jul 24-Jul 30-Jul 5-A u g 11-A ug 17-A ug 23-A ug 29-A ug 4-S ep 10-S ep 16-S ep 22-S ep 28-S ep Light Soda Ash Dense Soda Ash (Average price of soda ash from 1st Jan to 28th September) Export Date CHINESE SODA ASH EXPORTS To Aug Jul Jan-Jul Tons Tons Tons Indonesia 54,566 54,448 331,395 S. Korea 49,096 41,152 295,557 Vietnam 29,991 16,777 154,593 Thailand 17,337 13,022 131,135 Page 15
Japan 14,800 16,196 93,7 Bangladesh 11,165 9,380 97,940 Nigeria 9,857 10,937 42,766 Taiwan 5,953 3,697 33,656 India 5,742 3,011 25,176 Algeria 5,385 0 5,386 Philippines 3,751 11,953 99,474 Malaysia 2,738 3,218 43,037 Pakistan 1,871 987 3,923 Honduras 1,848 1,128 10,046 N. Korea 1,763 1,292 15,206 S. Africa 1,132 3,690 13,178 Salvador 1,098 1,348 3,090 Others 9,178 19013 71,364 Total 227,270 210,262 1,469,998 CHINA SODA ASH* EXPORTS IN August 20 Trade mode Volume Sum Average prices Tons USD USD/MT Frontier Small Trade 33 11,175 339 Processing Trade - - - External Contractors Project 134 52,429 391 General Trade 227,103 66,386,526 292 Others - - - Total 227,269 66,450,130 All data sourced from CIQ CHINESE SODA ASH EXPORTS TO KEY REGIONS August, Volume, MT Average price, USD/MT Indonesia 54,566 281 S. Korea 49,096 296 Vietnam 29,991 294 Thailand 17,337 290 Japan 14,800 280 Bangladesh 11,165 296 Nigeria 9,857 313 Taiwan 5,953 287 India 5,742 311 Algeria 5,385 328 others 23,379 total 227,269 Page 16
The volume and average prices of China's Export Soda Ash 20 Volume 250000 200000 150000 100000 50000 350 300 250 200 150 100 50 USD/MT 0 Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug 0 Volume Average prices Page 17
Hydrochloric acid CHINESE DOMESTIC PRICES E.China S.China N.China NE.China SW.China C.China NW.China Sep 4 RMB/mt 370-500 500-560 430-570 700-750 600-650 370-500 250-450 Sep 11 RMB/mt 370-500 500-560 430-570 700-750 600-650 370-500 250-450 Sep 22 RMB/mt 370-510 500-560 430-570 700-750 290-360 370-500 280-420 Sep 28 RMB/mt 350-500 420-500 420-570 720-800 100-200 350-450 280-420 HYDROCHLORIC ACID PRODUCTION OUTPUT, MT Hydrochloric acid Jan Feb Mar Apr May June July Aug E.China 164,020 152,201 181,802 203,911 193,942 196,523 178,251 181,339 S.China 58,1 47,499 64,315 59,361 64,867 70,068 64,961 61,569 N.China 149,882 137,546 126,249 153,5 136,150 135,253 142,238 127,866 SW.China 47,176 41,557 49,846 46,673 55,501 61,9 57,019 55,871 NW.China 63,428 72,877 82,1 78,913 62,469 86,184 92,067 90,114 NE.China 31,747 26,247 24,932 24,435 22,802 29,493 26,974 24,613 C.China 106,178 85,722 98,986 85,920 93,226 98,726 91,172 104,851 Total 620,539 563,649 628,211 652,298 628,957 678,155 652,682 646,223 CHLORINE Highlights Chlorine prevailing prices continued to drop sharply in September. The Olympic Games was over at the end of August, but downstream demand was insipid, especially PVC production. Most Chlor-alkali suppliers had to shut down to decreased chlorine output. All the chlorine downstream sectors had to face the difficult offtakes, chlorine sellers conceded lower price in response to the deteriorating market conditions. Analysts said that chlorine price would continue to reduce in October. Average price RMB/mt Region Four weeks July ago E.China 1190.23 1384.52 Market movement Downstream demand declined obviously, and price fell sharply. Forecast Page 18
S.China 1434.52 15.33 N.China 989.28 1147.62 NE.China 1152.38 1416.67 Excessive inventory and sluggish downstream demand impacted the price. Prevailing price rose slightly due to chloroactic acid factory warmed up Chlorine transport was still restricted in NE.China, price was stable. SW.China 15.14 1662.86 Prevailing prices fell by RMB 400-500/mt. C.China 964.28 1098.81 The price fell at RMB 500-600/mt in Henan province. NW.China 470.23 554.76 The chlorine price was at the lowest level across the domestic market. Note: 1 L-Soda: Light soda D-Soda: Dense soda 2 : stable, :slight increase, : slight drop, : sharp increase, : sharp drop CHLORINE DOMESTIC PRICES E.China S.China N.China NE.China SW.China C.China NW.China Sep 4 RMB/mt 950-1550 1300-1650 900-1300 1100-1300 1600-1700 700-1400 300-600 Sep 11 RMB/mt 950-1500 1300-1650 900-1200 1000-1300 1500-1650 600-1400 300-600 Sep 22 RMB/mt 900-1500 1300-1600 800-1050 1000-1200 1300-1600 600-1200 400-650 Sep 28 RMB/mt 750-1350 1200-1400 700-1050 1000-1200 1100-1450 500-1150 300-600 Downstream Sectors Products PVC Chlorinated paraffin ECH Chlorinated Methanes CPE Condition The sluggish market sentiment continued, most chlor-alkali producers still cut operating rates or entered into maintenance season. Many producers shut down due to insipid downstream demand. Most Epoxy chloropropane producers cut operating rates thanks to regional sluggish downstream market situation. Most producers were back up sold the inventory. The CPE producers had to cut operating rates because of subdued downstream demand. Page 19
Glossary E.China N.China S.China NE.China SW.China C.China NW.China Jiangsu, Jiangxi, Zhejiang, Anhui, Shanghai Beijing, Tianjin, Hebei, Inner Mongolia, Shanxi, Shangdong Guangdong, Guangxi, Fujian Heilongjian Jilin, Liaoning Sichuan,Chongqing, Yunnan,Guizhou Henan, Hubei, Hunan Shanxi, Qinghai, Gansu, Sinkiang, Ningxia Subscription: Ms. Lily wang & Ms. Olivia wang Tel: 06-10-64384105 Fax: 06-10-64380147 Address: Room 5D Ambassador Mansion Jiuxianqiao Road Chaoyang district Beijing China Post Code:100016 Page 20