SODA ASH MARKET ANALYSIS

Soda ash, also known as sodium carbonate, has several substitutes that are now being widely used by industries, which were traditionally major consumers of soda ash. One such substitute is sodium bicarbonate, commonly known as baking soda. Sodium bicarbonate is now increasingly being used in several applications instead of soda ash such as food industry, detergents manufacturing, and water treatment. It provides similar properties but is more environment-friendly and costs less than soda ash.  Another major substitute of soda ash gaining popularity is calcium chloride. The chemical industry, which was one of the largest end users of soda ash, is now opting for calcium chloride for various applications such as wastewater treatment. It serves the same purpose as soda ash but with additional benefits such as being effective at lower concentrations and faster reaction times. It also does not produce harmful carbon dioxide gas on reaction like soda ash. This has made calcium chloride a favored alternative. According to the data by UN Comtrade, global imports of calcium chloride had increased by over 11% annually between 2018 to 2020, indicating its rising preference over soda ash.

Opportunity: Growth in emerging economies

Growth in emerging economies provides significant opportunities for expansion in the global soda ash market. With rapidly developing industries and increasing consumer incomes, demand is surging in nations like India, China, Indonesia and others.  These countries see some of the highest GDP growth rates in the world currently. For example, according to World Bank data, India recorded a GDP growth of 8.3% in 2020 and 8.7% in 2021, showing strong economic resilience during the pandemic. As incomes rise across vast populations, demand grows for basic necessities as well as products requiring soda ash as an input. Industries like glass, soaps and detergents see expanding manufacturing and sales in such emerging markets. Greater industrial activity necessitates higher soda ash consumption for uses like water treatment and flue gas desulfurization in coal-fired power plants too.  Further, governments are increasingly prioritizing infrastructure development like building projects, highways and urbanization. This bodes well for the cement and concrete industries where soda ash is a primary raw material. For instance, the Asian Development Bank estimates that developing countries in Asia will require USD 1.7 trillion annual infrastructure investment between 2016-2030. A significant part of this expenditure will come from nations exhibiting high economic growth. As infrastructure building accelerates in the coming years, it will drive global soda ash demand higher through increased cement and aggregates manufacturing.