• Caustic Soda Market Intelligence | Price, Forecast, Cost Models, Market Analysis

Caustic Soda Market Description

The caustic soda market size in India is expected to grow at a CAGR of 5 percent by 2020, to reach $ 2.42 billion in the forecasted period. The growth of the textile industry in India, which is expected to reach $230 billion by 2020 will fuel the demand for caustic soda in India. Development in end-use industries such as aluminum, pulp & paper, and soaps & detergents is also expected to drive the caustic soda market in India. Japan is the biggest importer of caustic soda to India; thus sourcing from Japan can be secured due to established trade routes. However, logistics cost and import duties are considered while engaging with multiple sources. Nearly 267,000 tons of caustic soda is predicted to be manufactured by NALCO and GACL by the year 2020 in Dahej. This will correspondingly improve the domestic supply of caustic soda.

The report provides an in-depth analysis of the key drivers and constraints in the caustic soda market along with the Porter’s Five Forces Analysis. The report further covers the supplier landscape in India with the SWOT analysis of major companies including Aditya Birla Group, DCM Shriram, Gujarat Alkalies & Chemicals Limited, and Chemplast Sanmar. It further examines the caustic soda pricing based on the demand and supply conditions and the key cost elements in the industry.

Beroe gathers intelligence through primary sources that include industry experts, researchers, and consultants, as well as current suppliers, producers and distributors. Secondary sources can include business journals, newsletters, magazines, market research data, company sources, and industry associations. Following data collation, analysis, and strategic review, the Final Research Report is published on Beroe LiVE.

Report Coverage

Key cost elements and Drivers
Caustic Soda Pricing
PESTLE Analysis – India
SWOT Analysis – DCM Shriram

Caustic Soda Market Trend, Analysis & Forecast

Category Intelligence on Caustic Soda covers the following

Information relating to market, supply, cost, and pricing analysis
Hard to find data on cost and TCO models, supplier details, and performance benchmarks
Macroeconomic and regional trends impacting cost, supply, and other market dynamics
Category-specific negotiation and sourcing advice

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Executive Summary

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Market Analysis

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Supply Analysis

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Cost & Pricing Analysis

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Best Practices

Insights
Caustic Soda Market Dynamics – India
Caustic Soda Market Size – India
Caustic Soda Market Segmentation
Growth Drivers and Constraints
Caustic Soda Trade Dynamics
Caustic Soda Supplier Landscape
Caustic Soda Pricing
Caustic Soda Key cost elements and Drivers
Caustic Soda PESTLE Analysis
PORTER’s Five Forces analysis
SWOT Analysis – Top four players in the market
India – GDP & PMI
India – Political and Structural Scenario
India – Inflation & labor Wages

Regional Market Outlook on Caustic Soda

India’s caustic soda installed capacity is expected to reach 4 MMT in 2018-2019 due to capacity expansions by players like Grasim Industries and DCM Shriram. The demand growth slowed down during 2016-2017 due to demonetization in India during November 2016. The demand is expected to grow by 4-5 percent in the forecast period.

Higher Operating Rates: To cater to the increasing domestic demand, Indian producers are expanding capacities and also operating existing capacities at higher rates of about 85-95 percent
Grasim Industries (part of Aditya Birla Group) has increased caustic soda capacity by 67 percent to 356,000 tons/year. The increased capacity is anticipated to be easily absorbed by the domestic market due to strong demand from downstream alumina and textile sectors

Insights

Multiple Sourcing :

Buyers can engage in multiple sourcing from domestic as well as international suppliers so as to lower the risk of price volatility and secure supplies
Japan is the biggest importer of caustic soda to India, so sourcing from Japan can be considered due to established trade routes. However, logistics cost and import duties have to be considered while engaging with multiple sources

Increasing capacities in India :

Grasim Industries (part of Aditya Birla Group) has increased caustic soda capacity by 67 percent to 356,000 tons/year
Nalco and GACL are also expected to bring 267,000 tons/year plant in Dahej by 2020 which will improve domestic supply

Demand growth in India

Growth of textile industry in India which is expected to reach $230 billion by 2020 will fuel demand growth of caustic soda in India
Growth in automobile industry/car sales in India will improve demand for aluminum and in turn support growth of caustic soda demand from alumina smelting

Market Segmentation

Caustic soda market can be segmented based on type of caustic soda and the end-use application

Based on Type: Caustic soda market can be segmented into lye and flakes. Caustic soda lye is a solution of caustic soda and water. The percentage of caustic soda in lye usually ranges between 32-50 percent based on application.
Caustic soda flakes are anhydrous caustic soda, with about 99-99.9 percent caustic soda.

Based on Application: During 2017, the textile industry was the biggest consumer of caustic soda followed by alumina smelting and pulp and paper

During 2017, caustic soda consumption from organic and inorganic chemical formulations formed about 21 percent of the overall demand
Other applications of caustic soda include, soaps and detergent industry, water treatment and dyes and inks among others

Growth Drivers and Constraints

Drivers

Growth from Applications:

Textile industry is the biggest consumer of caustic soda in India and makes up for about 20 percent of the domestic demand
Growth of textile industry in India which is expected to reach $230 billion by 2020 will fuel demand growth of caustic soda in India
Growth in automobile industry/car sales in India will improve demand for aluminum and in turn support growth of caustic soda demand from alumina smelting

Constraints

High cost of investment

Investment in membrane technology is as high as $100 million for a 100,000 DMT/year plant, which can have an ROI period of 8–10 years, and hence is a major entry barrier for new players
Indian manufacturers face fierce competition from imported caustic soda, which is cheaper compared to the domestic produce. This is due to high input and logistics costs within the country

Co–product dynamics

The market growth for caustic soda is highly dependent on the chlorine market dynamics
In H1 2018, chlorine prices hovered around negative range in India, where producer had to pay the buyer for chlorine
Chlorine market is expected to grow with growth in vinyl segment with the demand for PVC in India