According to the Commodity Market Analysis System of Business Society, due to significant fluctuations in raw material costs, the overall market price of sodium metabisulfite in China hit a bottom and rebounded significantly in the first three quarters of 2023. On September 30, the average price of industrial grade sodium metabisulfite was 2550.00 yuan/ton, a significant increase of 43.75% compared to the low point of the year.
In the first quarter, the price of domestic soda ash increased by 4.23%, while the price of sulfur decreased by 16.01%. The overall bottom of raw material costs fluctuated, and the market price of sodium metabisulfite remained relatively low and consolidated. Supported by the continuous low start of production by production enterprises and a shortage of 30% of product inventory, the overall low and slightly strong market price of sodium metabisulfite in the first quarter increased by 2.84%,
In the second quarter, the cost of upstream raw materials significantly decreased, with soda ash prices falling by 28.99% and sulfur prices falling by 33.13%. The cost of raw materials significantly decreased, and under a low-pressure system, the domestic market price of sodium metabisulfite significantly decreased. Under the mentality of buying up or not buying down, downstream trading entities had a strong wait-and-see attitude, and the problem of strong market supply and weak demand was highlighted. The domestic market price of sodium metabisulfite continued to decline weakly, with an overall significant drop of 18.62% in the second quarter.
In July, the raw material cost fluctuated and stabilized, and the decline in the market price of sodium metabisulfite slowed down. In August and September, the raw material cost rebounded significantly, and supported by a significant increase in costs, the domestic market price of sodium metabisulfite rebounded significantly. Downstream stocking was relatively active, and the market entered a supply-demand situation. In the third quarter, the domestic market price of sodium metabisulfite rebounded significantly, with an overall increase of 36.44%.
The 100 day moving correlation coefficient r100 between soda ash and sodium metabisulfite is 0.916, which is greater than its long-term correlation coefficient of 0.847 since 2011-03-01. The domestic market price of sodium metabisulfite is mainly affected by fluctuations in domestic soda ash prices.
Supported by a significant increase in raw material prices in the third quarter, the domestic market price of sodium metabisulfite has significantly increased. In October, the upstream raw material prices of sodium metabisulfite overall rose and fell. As of October 9th, the price of soda ash fell by 2.91% during the month, while the price of sulfur fell by 5.91%. The cost of raw materials rose and fell, leading to a slight decline in the overall domestic market price of sodium metabisulfite.
Analysts from Business Society believe that due to the recent rise and fall in upstream raw material prices, downstream trading entities are more cautious in their purchasing intentions. Manufacturers have slightly lowered their factory prices to ensure shipment, and in the short term, under a low cost system, there will still be some room for the domestic market price of sodium metabisulfite to fall back. Overall, the current domestic soda ash price is still relatively high, and the relatively high raw material cost operation will provide some support for the future market price of sodium metabisulfite. Throughout the year, the supply and demand of the domestic sodium metabisulfite market is relatively stable, and the fourth quarter is the traditional off-season of demand. It is expected that the domestic market price of sodium metabisulfite will not reach a new high in the fourth quarter, and the overall operation will continue to follow the relatively high price of soda ash.
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