New bill to maintain US soda ash competitiveness

By Kasia Patel
Published: Wednesday, 30 September 2015

US senators vow to protect industry; demand peservation of 2% royalty and accuse China of unfair trade practices.

The American Soda Ash Competitiveness Act, a bill to set the royalty rate on sodium compounds and related products produced from federal land at 2% for the next five years, was introduced by two US Senators on 15 September.

John Barrasso and Ron Wyden presented the bipartisan legislation to maintain competitive royalty rates on natural soda ash from the US, allowing manufacturers to compete with increasingly prolific Chinese production.

"American soda ash producers are battling unfair foreign trade practices of China and other countries. The last thing Washington should do is raise costs here at home," Barrasso, senator for the US state of Wyoming where the US natural soda ash industry is centred, said in a statement.

Soda ash, or sodium carbonate, is used in the production of glass, detergents and other industrial goods. In the US, the majority of soda ash produced from trona, which is found in high concentrations on federal land in California and Wyoming.

In 2016, the US exported around $1.3bn-worth of soda ash, according to official US records, around 57.5% of the country’s total production, making it the second largest inorganic export from the US in terms of value and accounting for thousands of jobs in sectors including mineral production, shipping and manufacturing.

"Natural soda ash produced in the US directly supports hundreds of jobs in Oregon and, across the country, was the second largest export for the Port of Portland last year," Wyden, senator for the state of Oregon, said.

While over the last 15 years China has grown to become the largest producer of soda ash globally, according to the senators this has been achieved through unfair trade practices such as a 9% rebate on China’s VAT for domestic producers and the devaluation of the country’s currency by 4.4% to boost exports.

With the current royalty rate of 4% in the US set to increase to 6% in October, Wyden said it was the Senate’s responsibility to ensure the future of the American soda ash industry. "Continuing the royalty relief for domestic soda ash keeps the playing field level so American producers can stay competitive in a global market where China is gaming the system and producing synthetic soda ash exports at the expense of US producers and the environment," he said.

The bill is the Senate companion to HR 1992 introduced on 23 April 2015 by California Congressman, Paul Cook, who said that protecting the US soda ash industry was a matter of national security.

At the time, a government press release drew attention to the lower lifecycle emissions of carbon dioxide from US natural soda ash production compared to Chinese synthetic soda ash, which is made from limestone and salt via energy intensive processes, as well as the lower contributions of sulphur dioxide, nitrogen, particulate matter and contributors of ground-level ozone.

"While American soda ash is found naturally, Chinese soda ash is produced synthetically. Chinese synthetic production uses twice the energy which results in over three times the carbon emissions as natural soda ash production," the US Government statement outlined.