Recent increase in China’s soda ash export volume: China’s soda ash export volume has gradually increased since 2022. According to the General Administration of customs, China’s soda ash export volume from January to February 2022 was about 166000 tons, with a year-on-year increase of + 8.45%, of which the export volume to Southeast Asian countries increased significantly.
Energy prices have risen sharply, and the cost of soda ash has increased significantly: some overseas soda ash production capacity is ammonia soda process, which requires a large amount of coal or natural gas to be consumed in the production process. According to Solvay, there are still six synthetic soda plants in Europe in 2021, and the current soda ash production capacity in Europe accounts for about 20.9% of the world. According to Yahoo and S & pgglobal Platts, as of April 8, 2022, the price of TTF benchmark Dutch natural gas futures reported 103.88 euros / MWh (year-on-year + 436.8%), and it is estimated that the cost of ammonia alkali method in Europe has increased by 112.5 euros / ton since the beginning of the year, about 778.7 yuan / ton. In addition, according to the New York Mercantile Exchange, as of April 8, 2022, The CIF price of European Coal ara port (API 2) (Argus McCloskey) was reported at US $292.65/t (year-on-year + 327.5%), and it is estimated that the cost of ammonia alkali method of coal increased by US $111.8/t year-on-year, about 711.7 yuan / T. In addition to European and American countries, according to gHCl, the leader of Indian soda ash, the current rising coal price has had an impact on its cost of about 20% – 25%. According to Bloomberg, as of April 7, 2022, the spot price of Indian soda ash is about 3354 yuan / ton, compared with + 15.9% at the beginning of 2022. In addition, the transportation cost of overseas soda ash continues to increase. According to the local truck transportation association of Wyoming, the main origin of American soda ash, they will adjust the charging standard accordingly and transfer it to customers. At the same time, according to the ansac of American soda Association, in view of the rising natural gas price, From January 1, 2022, when the natural gas price exceeds US $5.00/mmbtu, a natural gas surcharge will be levied on all soda ash products shipped to customers and distributors around the world. The substantial increase in the cost of overseas soda ash is conducive to the competitiveness of China’s soda ash in the global market.
The accelerated development of global photovoltaic glass drives the demand for soda ash: the price of photovoltaic glass in China has continued to increase since 2022. According to Baichuan Yingfu, the average price of 3.2mm coating of photovoltaic glass in China as of April 9 is 27.5 yuan / m2, compared with + 10.0% at the beginning of the year. According to Longzhong information, it is expected that the production capacity of photovoltaic glass in China is expected to reach about 56000 tons / day in 2022. In addition, according to the report of PV magazine in March 2022, In order to meet the expected demand growth, borosil, the world’s largest non Chinese photovoltaic glass manufacturer, plans to increase its production capacity by nearly five times in 2023. We believe that the demand for raw soda ash driven by photovoltaic glass will be good in the future.
Investment suggestion: with the rising cost pressure of global soda ash, China’s soda ash has greatly improved its global competitiveness, and its export volume to Southeast Asia, Japan and South Korea is expected to exceed expectations from the second quarter of 2022. Under the situation of tight supply and demand in China, it is suggested to further promote the prosperity of the industry. It is suggested to pay attention to Inner Mongoliayuan Xing Energy Company Limited(000683) , Tangshan Sanyou Chemical Industries Co.Ltd(600409) , Cnsig Inner Mongolia Chemical Industry Co.Ltd(600328) , Shandong Haihua Co.Ltd(000822) , etc.
Risk tip: energy prices fluctuate sharply, international geopolitical development exceeds expectations, and the recovery of real estate is less than expected
