Shandong Chlor-Alkali Association as a good "coordinator"
Plastic Auxiliary Machine,Pipe Belling Machine,Pvc Pipe Expanding Machine,Pipe Expanding Machinev ZHANGJIAGANG MYHAL MACHINERY CO.,LTD , https://www.myhalmachinery.com
In recent years, the chlor-alkali industry in Shandong has experienced rapid growth. The number of chlor-alkali enterprises in the province increased from 24 in 2001 to 33, and the production capacity of caustic soda rose from 1.2 million tons per year to 3.18 million tons per year, reflecting an average annual growth rate of 44%. As the industry expanded, the Shandong Chlor-Alkali Association remained proactive, working to secure favorable raw material prices, sharing market insights among members, and promoting sustainable development.
The caustic soda industry is known for its high energy consumption. With rising costs of electricity and oil, production expenses have surged, reducing overall efficiency. Securing preferential pricing for the industry has become a top priority for the association. When Shandong Province introduced additional charges such as the Three Gorges Fund, rural power grid renewal fees, and urban public utility surcharges on captive power plants, the association quickly mobilized. It organized representatives from all chlor-alkali companies to submit a formal letter to the China Chlor-Alkali Association, which then conveyed the issue to the National Development and Reform Commission. Eventually, the central government exempted these charges for alkaline cogeneration plants.
Another key input for caustic soda production is raw salt. In recent years, the price of industrial salt has skyrocketed, squeezing profit margins. Although the "Notice on Improving Industrial Salt Supply, Marketing, and Price Management Measures" helped break the monopoly, Shandong issued its own "Regulations on the Management of Salt Industry," creating new barriers for salt and alkali producers. The Shandong Chlor-Alkali Association promptly responded, submitting industry feedback at the national salt conference. It proposed revising the local regulations to better align with national policies and protect industry interests.
Thanks to Shandong’s abundant resources—salt, electricity, and coal—the region has been well-positioned for chlor-alkali development. Since 2002, many enterprises have expanded their production capacities. Between the second half of 2004 and the first half of 2005, new capacity added exceeded 600,000 tons per year. However, challenges emerged due to limited sales reach for liquid caustic soda, inconsistent road transport policies, and slower downstream demand growth. This led to low sales and growing supply-demand imbalances. In response, the association actively worked to stabilize the market by organizing meetings, sharing information, and encouraging cooperation. These efforts helped prevent price fragmentation and reduce unhealthy competition among companies.