Shandong Chlor-Alkali Association as a good "coordinator"
Plastic Shredder Machine,Pipe Shredder Machine,Paper Shredder Machine,Heavy Duty Paper Shredder 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 in 2001 to 3.18 million tons per year, representing an average annual growth rate of 44%. As the industry expanded, the Shandong Chlor-Alkali Association remained proactive, working to secure better pricing for raw materials, sharing market insights among members, and promoting sustainable development.
As a high-energy-consuming sector, the caustic soda industry faces rising energy costs, particularly for electricity and oil, which have significantly increased operational expenses and reduced efficiency. Securing favorable energy prices for the industry became a key focus for the association. When Shandong Province introduced additional charges such as the Three Gorges Fund, rural power grid renovation fees, and urban public utility surcharges on captive power plants, the association mobilized all member companies to submit a formal letter to the National Development and Reform Commission through the China Chlor-Alkali Association. Ultimately, these three charges were waived for alkaline cogeneration plants, easing the financial burden on local producers.
Another critical input for caustic soda is raw salt. Over the past two years, salt prices have surged, eroding profit margins. While the central government issued a notice to reform industrial salt supply and pricing mechanisms, breaking the monopoly, Shandong Province enacted its own "Salt Industry Management Regulations," creating new barriers for salt and alkali producers. In response, the Shandong Chlor-Alkali Association actively participated in national meetings, advocating for changes to the provincial regulations and pushing for policies that support the industry’s interests.
Thanks to abundant salt, electricity, and coal resources, Shandong has a strong foundation for chlor-alkali development. Since 2002, local companies have continuously expanded their capacities. Between the second half of 2004 and the first half of 2005, new production capacity reached over 600,000 tons per year. However, challenges arose due to limited sales radius for liquid caustic soda, inconsistent road transport policies, and slower downstream demand growth, leading to low sales performance. This created a growing imbalance between supply and demand. In response, the association remained committed to market coordination, holding regular meetings and sharing updates, which helped stabilize pricing and reduce unhealthy competition among enterprises.