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When will the bitter days of soda ash come to an end?

wallpapers News 2020-11-04

has been suffering for more than a year since the soda ash market turned into a downturn in the third quarter of last year. At present, with the spread of losses in the industry, enterprises are suffering, naturally there are continuous complaints. Some complain that the policy is not willing to patronize the hard hit soda ash industry, some complain that the downstream processing industry market dem are not competitive, some even vent their resentment on the real estate industry. Why do

soda ash enterprises suffer? How long will it take to stay in it? I believe that if the industry can clarify the following aspects of understing, the above problems will be self-evident. First of all, not all resource advantages can be transformed into product market advantages. The production center of soda ash in China lies in the eastern coastal area the Western Salt Lake area. The east coast is not only rich in sea salt brine, but also an important market core area, so it has always been the first choice for all capital distribution of soda ash industry. Salt Lake area is rich in resources is favored by some funds. However, with the advantages of resources, everything may not be all right. Because whether resources can be successfully converted into products, the key lies not in resources, but in the market. From the perspective of resource transformation product form, to go through production, circulation, consumption other links, as long as a certain link "jam", the enterprise reproduction can not continue, the resource advantage can not be exerted. In terms of capital form, material funds, finished products funds product receivables funds are deducted one by one. If the funds cannot be returned in time, the reproduction can not continue. Therefore, even if we have the advantage of resources, we may lose a lot in the market of disorderly competition.

secondly, the market can be cultivated, but it can not be achieved overnight. In the long run, social dem for products is a process of gradual growth, any short-term sharp increase or decrease is abnormal. The reason for the downturn of soda ash over the past year is that the industry has created a fictitious exaggerated market in the early years, but it can not be entirely attributed to the downturn of downstream dem the failure of the real estate industry. In fact, more more houses are built every year, the output of glass other related industries is also increasing year by year. The problem is that the pure soda industry itself has already broken the balance of supply dem. It is difficult to match the rapidly exping supply with the slowly rising dem, so it will suffer.

once again, excessive superstition on scale may harm others harm the market. Under the pressure of the market, many enterprises tend to be superstitious about the scale advantage hope to crush the competitors after they become bigger. If only one family holds this idea, it may be profitable, but if everyone is of the same mind, it will become a disaster. Resources stored in the ocean or underground are always wealth. However, if we exploit resources on a large scale with the idea of quick success instant benefit, we will not be able to make a profit, it is likely to lose money. The consequence of excessive superstition on scale is that even if the current domestic soda ash market is so withered, the enthusiasm for capacity expansion is increasing. It is understood that at present, including foreign funds, state-owned enterprises funds, private funds, etc., are involved in the expansion of soda ash in full swing. Take Jiangsu Province as an example, seven or eight soda ash enterprises in the province are in hot production scale. New or exped projects often exceed 500000 tons, million tons are not rare. The total production capacity of the whole province has exceeded 3 million tons. The total capacity of soda ash in China is more than 30 million tons, the effective dem is only 20 million tons.

to sum up, blindly exaggerating resource advantages, optimistic virtual market superstitious scale are bound to lead to overcapacity, resulting in market selling, loss, downturn, "the flow of fertilizer into foreign fields". If the soda ash industry does not have a deep understing of this, the bitter days will not come to an end.

Author: Wang Yunli article source: China chemical industry news


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TRUNNANO (aka. Luoyang Tongrun Nano Technology Co. Ltd.) is a trusted global chemical material supplier & manufacturer with over 12 years' experience in providing super high-quality chemicals and Nanomaterials. The nitride powder produced by our company has high purity, fine particle size and impurity content. Please contact us if necessary.
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