Shouchuang Futures: Supply and demand remain loose, soda ash futures continue to decline

On the supply side, Henan Junhua is expected to resume production, Inner Mongolia Boyuan Silver Root Chemical’s output has not yet recovered, with a soda ash capacity utilization rate of 82.52%. Last week, soda ash production was 775.4k tons, down 42.7k tons from the previous week, a decrease of 5.22%. Soda ash manufacturer inventories stood at 1.8519 million tons, down 1.9k tons week-on-week, a decrease of 0.1%. Social inventories of soda ash increased by 20k tons, currently at 310k tons. Pending orders for soda ash have decreased by 3 days, currently maintained at around 10 days. This week, Inner Mongolia Boyuan Silver Root may increase production, and Henan Junhua is expected to recover. The projected soda ash output is 790k tons, with the operating rate rising to 83%, maintaining high supply levels.

On the demand side, downstream demand is moderate, mainly just-in-time procurement, with increased wait-and-see sentiment. Downstream consumption remains stable or slightly declining, with significant pressure on finished product inventories, and some industry production lines are halting or reducing output. Float glass daily melting volume has decreased to 143.6k tons. This week, three float glass lines are expected to undergo cold repairs, with a total capacity of 1,900 tons, and weekly production is estimated at 1.0092 million tons. One photovoltaic line with an 800 MW capacity is releasing water, with an estimated in-production capacity of 608.8k tons.

In summary, with the recovery of soda ash plants, supply is increasing, and the downstream glass industry is still in a destocking phase, with daily melting volume likely to continue declining, and soda ash remaining in a surplus pattern. In the short term, soda ash futures are expected to remain weak, with attention to energy price fluctuations, plant maintenance, and downstream inventory replenishment pace. (First Capital Futures)