Review of the 2023 market situation of polyaluminum chloride

According to the commodity market analysis system of Business Society, the average price of solid (industrial grade, content ≥ 28%) polyaluminum chloride in the domestic market in 2023 was 2033.75 yuan/ton at the beginning of the year and 1777.50 yuan/ton at the end of the year, with an annual decline of 12.60%. The highest point of the year occurred on January 1st at 2033.75 yuan/ton, and the lowest point of the year occurred on August 29th at 1700.00 yuan/ton, with a maximum amplitude of 16.41%. The market for polyaluminum chloride will experience a high-level decline in 2023.

According to the monthly K-bar chart data of the 2023 polyaluminum chloride market from Business Society, the polyaluminum chloride market experienced more declines and less gains in 2023, with 4 months of upward movement and 8 months of downward movement. The highest increase was in October, up 1.45%, and the highest decrease was in April, down 3.81%.

From January to early September, the market for polyaluminum chloride continued to decline. Water treatment enterprises in China’s main production areas had normal production, sufficient spot inventory, unfavorable downstream procurement demand, weak industry prosperity, and a sustained weak market for polyaluminum chloride. From mid September to the end of the year, the market for polyaluminum chloride slightly rebounded, and the domestic market remained in a state of oversupply. The polyaluminum chloride market remained low, and market purchasing enthusiasm increased. In addition, some raw material prices rebounded, leading to an upward trend in polyaluminum chloride prices.

Market forecast for polyaluminum chloride in 2024

Cost side: According to the commodity market analysis system of Business Society, the domestic hydrochloric acid market will experience a wide range of fluctuations in 2023. The average price at the beginning of the year was 174 yuan/ton, and the average price at the end of the year was 112.50 yuan/ton, with a year-on-year decline of 35.34%. The East China region is one of the main regions for hydrochloric acid production in China. Among them, Jiangsu Province is one of the important bases for hydrochloric acid production in China, with hydrochloric acid production ranking first in the country. In 2024, with the strengthening of environmental protection policies, some hydrochloric acid production enterprises may be forced to stop or reduce production, and hydrochloric acid production may decrease.

Supply side: According to incomplete statistics, there are currently more than 300 polyaluminum chloride production enterprises in China, with an annual production capacity of over 300000 tons (calculated based on a solid alumina content of 30%), mainly used for water treatment. The production capacity of northern regions, represented by Henan and Shandong, accounts for about 70% of the total domestic production capacity. In addition, due to abundant raw material resources, the Gongyi region of Henan has formed an industrial cluster with more than 130 local production enterprises, accounting for more than 50% of the total production capacity. It plays a leading role in balancing domestic supply and demand and has become a typical production base. At the same time, these enterprises have established distribution offices in Guangdong and other regions to implement regional structural adjustments in production and consumption. The northern region is gradually becoming a production base for polyaluminum chloride. The demand in the southern region continues to grow, becoming the main domestic consumption area.

Demand side: In addition to being used for traditional domestic water, industrial water, and urban sewage treatment, polyaluminum chloride can also be used for the treatment of pulp and paper wastewater, pharmaceutical wastewater, and printing and dyeing wastewater. As of 2023, the number of urban sewage treatment plants in China has exceeded 2000, with a daily processing capacity of 170 million cubic meters. At the same time, more and more rural areas are starting to build sewage treatment facilities, further promoting the development of the industry. With the strengthening of people’s environmental awareness and the strengthening of national environmental supervision, the application scope of polyaluminum chloride in water treatment will become increasingly broad, and the development prospects are optimistic.

Market forecast: Currently, the supply of polyaluminum chloride in China exceeds the demand, making it a buyer’s market with high market competition pressure. In 2024, China’s polyaluminum chloride inventory remains abundant; Although the demand for polyaluminum chloride has increased in 2024, the market is still in a state of oversupply. It is expected that the overall polyaluminum chloride market will fall in 2024.