Caustic soda, scientific name sodium hydroxide, chemical formula NaOH, is a strong corrosive alkali. Caustic soda is a basic chemical raw material, and there is a saying in industry that "three acids and two bases", which refers to the five basic chemical raw materials in national economic life, including hydrochloric acid, sulfuric acid, nitric acid, caustic soda, and soda ash. Without the basic chemical industry of three acids and two bases, modern industry cannot develop. Thus, the industrial status of caustic soda can be seen.
The use of caustic soda is very extensive, mainly used in alumina, papermaking, dyes, chemical fibers, water treatment, metal smelting, petroleum refining, cotton fabric finishing, purification of coal tar products, as well as food and wood processing, mechanical and chemical industries, and other aspects. Among them, alumina, chemical industry, and chemical fiber are the main downstream consumer industries of caustic soda, accounting for about half of the total demand for caustic soda.
The upstream raw materials for producing caustic soda mainly include electricity, raw salt, water, etc. Among them, producing 1 ton of caustic soda requires 2300-2400 degrees of electricity, 1.4-1.6 tons of raw salt, and 6 tons of water. Electricity accounts for about 60% of the total production cost, and raw salt accounts for about 20% of the total production cost. However, the price of water is relatively fixed and the cost is relatively low, which can be almost ignored. From historical data, the prices of raw salt and electricity are also relatively stable in the long term, and their impact on the fluctuation of caustic soda prices is limited.
From the perspective of the raw materials and production process of caustic soda, its production cost is relatively fixed and generally does not fluctuate significantly with the fluctuations of the economic cycle. Caustic soda enterprises can avoid production and have high flexibility in times of downturn. However, caustic soda has a wide demand and will not experience a significant decline in demand due to a downturn in a particular industry. Therefore, caustic soda has similarities with agricultural products, making it more suitable for long selling and less suitable for short selling.
What is the production and import and export of caustic soda? In 2015, the production of caustic soda was approximately 30.2 million tons, and it has been increasing year by year. By 2022, it will reach 39.8 million tons, with an average annual growth rate of about 4.5%. China is a net exporter of caustic soda, but the proportion of imports and exports compared to production and consumption is not significant. In 2021, China's caustic soda production was 38.91 million tons, with an import volume of 54700 tons and an export volume of 1.4823 million tons. The net export was 1.4276 million tons, accounting for 3.67% of the production.
