The Zhitong Finance App learned that Haitong International released a research report saying that from November 24 to 30, the domestic soda ash market continued to rise. Recently, domestic soda ash prices have continued to be tight, manufacturers have restricted many orders, and the volume of new orders is relatively limited. Overall supply on the supply side of the soda ash industry is declining, and it is difficult to expect a recovery in the short term. On the demand side, as prices in the soda ash market have continued to rise recently, downstream users have begun to resist high prices. Currently, they are mostly receiving goods on a single order basis. In addition, the production of photovoltaic glass in October was 2,0443,500 tons, up 37.8% year on year and 2.69% month on month. The bank believes that as demand in the downstream photovoltaic industry increases, new photovoltaic glass projects will continue to be put into operation, thus driving the increase in demand for soda ash.

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Haitong International's views are as follows:

Soda ash market prices continue to rise, and the volume of new orders is limited.

According to Baichuan Information, the domestic soda ash market continued to rise from 2023.11.24-2023.11.30. As of November 30, the current average price of light soda ash market is 2,620 yuan/ton, up 242 yuan/ton from last Thursday; the average price of heavy soda ash market is 2,799 yuan/ton, up 161 yuan/ton from last Thursday. Recently, domestic soda ash stocks have continued to be tight. Manufacturers have limited orders, and the volume of new orders is relatively limited.

The operating rate of the industry is declining, and downstream users are competing against high prices.

According to Baichuan information, overall supply on the supply side of the soda ash industry is declining, and it is difficult to expect recovery in the short term. Shandong Haitian, Chongqing's Xiangyu, Hubei Shuanghuan, and Henan Jinshan soda ash installations are mainly low production maintenance. Qinghai Salt Lake, Qinghai Development Investment, and Qinghai Kunlun soda ash plants continue to operate at low production, and the Shaanxi Xinghua soda ash plant has now stopped for maintenance. On the demand side, as prices in the soda ash market have continued to rise recently, the mentality of downstream users resisting high prices is beginning to emerge. Currently, they are receiving products on a single order basis. As of December 1, the weekly operating rate of the soda ash industry was 82.32%, down 3.98% from the previous month.

The operating rate of the industry declined in November, and inventories gradually declined in November.

According to Baichuan News, from January to November 2023, the operating rate of the domestic soda ash industry will basically remain above 70%. In November 2023, the operating rate of the soda ash industry was 76.71%, down 5 percentage points from October. Factory inventories have gradually declined since November, and production declined in November. According to Baichuan Information, as of December 1, 2023, the total inventory of domestic soda ash companies was 348,000 tons, down 4.66% from the previous month, and the spot inventory volume fell.

Exports declined and imports rose in October.

According to Baichuan News quoting customs data, China imported 154,300 tons of soda ash in October 2023, a year-on-year increase of 3807.58%; in January-October 2023, China's soda ash imports totaled 522,000 tons, an increase of 367.62% over the previous year. In October 2023, China's soda ash export volume was 57,400 tons, a year-on-year decrease of 74.03%; from January to October 2023, China's soda ash exports totaled 1,335,800 tons, a year-on-year decrease of 19.78%.

Demand for flat glass is stable, and factory inventory has been removed.

According to Baichuan News, in November 2023, flat glass production was 4.02 million tons, up 1.77% year on year, down 2.73% month on month. Total production in January-November was 43.99 million tons, down 6.07% year on year, with a net decrease of 2,843,000 tons. As of December 1, the stock of flat glass was 1,896,600 tons, and the inventory level was moderate.

Benefiting from the increase in demand for photovoltaics, photovoltaic glass production continues to be released.

According to Baichuan News, in October 2023, photovoltaic glass production was 2,0443,500 tons, an increase of 37.8% over the previous year, an increase of 2.69% over the previous year. The total output in January-October was 16.5 million tons, an increase of 31.71% over the previous year, a net increase of 3.972 million tons. The bank believes that as demand in the downstream photovoltaic industry grows, new photovoltaic glass projects will continue to be put into operation, thus driving the increase in demand for soda ash.

Risk warning: Product prices fall; downstream demand falls short of expectations; exports fall.