Caustic soda is an important commodity chemical applied in pulp and paper, textile, chemical and petrochemical industries, as well as bleach manufacturing, nonferrous metallurgy, soap and detergent production, to name only a few. Industrial grade salt is a major raw material for caustic soda. Thus, the chlor-alkali (caustic soda) industry is often associated with rock salt deposits or petrochemical complexes, which act as processing facilities for the derived or associated products such as chlorine. It should be borne in mind that chlorine is a by-product of caustic soda production. For example, the more outdated electrolysis process generates 2.25 tons of 50% caustic soda with each ton of chlorine. Recent methods maintain a ratio of 0.88:1 between chlorine and caustic soda. The applications for chlorine and caustic soda are not the same, which stipulates different supply-demand interaction patterns, though the cross penetration of the two markets seems inevitable.
Brief analysis of the caustic soda production dynamics during pre-crisis, crisis and post-crisis years confirms that the global market for caustic soda is quite stable. The output drop of 2009 was not significant and was promptly alleviated. This is determined by the balanced structure of the market, steady and healthy demand from multiple applications, anti-oligopolistic nature of the market devoid of monopolies, reasonable technological trajectories and some other factors.
Global caustic soda production in 2005-2013 (tonnes)
Of course, the level of stability of the caustic market may vary from region to region, when some regions may demonstrate dwindling infrastructure, immature policies and unreasonable logistics, thus bringing these local markets to the period of flux and uncertainty. However, despite regional fluctuations it is evident that the global caustic soda market will fare well in the short-term and middle-term perspective. The global production of caustic soda is forecast to grow at 3% per annum in 2015-2018, with new chlor-alkali projects being planned in India, Indonesia, UAE, South Korea, Germany, France, China, Japan, Portugal, etc. The process of technological renovation and innovation will definitely continue. Thus, the use of membrane cell technologies will be growing due to lower capital and energy costs and mitigated environmental problems.
More information on the caustic soda market can be found in the research study “Caustic Soda 2015 World Market Outlook and Forecast up to 2019”.