New soda ash factory in China to reduce solar glass prices

Share

China-based Inner Mongolia Berun Group started production at a new natural soda ash factory in Inner Mongolia, China, in late June. The factory, located in Alxa Right Banner, is expected to reach a capacity of 5 million metric tons (MT) by the end of this year, accounting for approximately 13.8% of China's total soda ash production. Prior to the factory's opening, China's soda ash production stood at around 31 million MT.

Prior to the start-up of this new plant about 94% of the soda ash capacity in China was synthetic,” Marguerite Morrin, Research and Analysis Director at OPIS' Chemical Market Analytics division told pv magazine. “Natural soda ash production, which is via a mining process, is typically much lower cost than synthetic.”

Inner Mongolia Berun Group has invested $2 billion in the new facility and plans to allocate an additional $3 billion to expand its capacity to 7.8 million MT in the future.

According to Morrin, the new factory could contribute to a decrease in soda ash and PV glass prices.

“Soda ash prices had already started declining prior to the factory's commissioning, but this increased capacity may drive prices even lower,” she said.

Morrin explained that the average production cost for natural soda ash in the United States, where most natural production occurs, is approximately $100/MT.

“Natural production costs in China should be comparable, if not slightly lower,” she noted.

Morrin said China is an important exporter of soda ash and also exports a lot of products on a spot basis. Monitoring both prices and availability from China is therefore helpful in terms of understanding underlying global market dynamics.
“In August 2020, in the midst of the pandemic, China’s export prices average $161 per MT free on board (FOB) while by August last year prices increased to $420 per MT FOB,” she said. “This year we see a very different market dynamic with spot export prices today averaging $245 to $270 per MT FOB China.”
The world's total soda ash capacity is currently around 74 million MT. It is mostly located in the United States, Europe, the Middle East, and India.

This content is protected by copyright and may not be reused. If you want to cooperate with us and would like to reuse some of our content, please contact: editors@pv-magazine.com.

Popular content

Concentrated solar power, a much cheaper solution than batteries for energy storage
05 November 2024 By offering cheap energy storage, concentrating solar power has a huge potential. However, it requires international standards to become a competitive...