Caustic soda enters H2 2026 at approximately $620/tonne, up 8% year-over-year, as chlor-alkali co-product economics and alumina demand set the market balance. Global caustic soda production is forecast at 95 Mt in 2026, up 2% from 2025.
Alumina production consumes 35% of global caustic soda, with pulp/paper, chemicals, and water treatment the balance. Chinese alumina output growth at 5% annually is the primary demand driver.
Chlorine demand, the co-product, is the primary production driver. PVC, isocyanates (MDI/TDI), and water treatment consume chlorine. When chlorine demand is strong, caustic supply increases as a co-product, pressuring caustic prices.
Membrane cell technology represents 95% of global capacity, with mercury and diaphragm cells being phased out due to environmental regulations.
Price projections for H2 2026 cluster at $550-700/t.
Caustic soda buyers should secure H2 requirements at $580-650/t through fixed contracts. Chlor-alkali economics create cyclical supply dynamics. For alumina refineries, consider inventory management during chlorine demand peaks. Budget $550-720/t for 2027.