Yildirim’s new soda ash project in Kazakhstan to come online by 2022

By Michael Greenfield
Published: Wednesday, 01 May 2019

Turkish group Yildirim is entering the soda ash market with a new project in Kazakhstan but is unlikely to pose any market threat to established producers because it intends to serve the internal markets in Kazakhstan and nearby regions.

Turkey’s Yildirim Group is entering the soda ash market with a greenfield project in Kazakhstan that will produce 400,000 tonnes per year of material and serve the local and regional markets despite new capacity from producers already on stream.

Yildirim is known for producing chrome ore and ferro-chrome. It first made its intention of moving into the soda ash sector known in October 2016 when it signed a deal in a Kazakhstan-Turkey investment forum.

Since that agreement, two existing soda ash producers have announced they will bring new capacity to the market.

Ciner Resources will add 4 million tpy of soda ash production in the United States and Solvay will add 500,000 tpy across its Europe and US plants via debottlenecking.

According to Yildirim, this will not affect the outlined investment, "Our product is mainly for internal supply of Kazakhstan and nearby countries such as Russia, therefore Solvay and Ciner’s expansions don’t affect our target markets," Yildirim Group told Fastmarkets.

"Also we do not expect soda ash to be imported into Kazakhstan, when the plant is producing locally," the company added.

Yildirim is expected to bring its 400,000 tpy plant in the Taraz region online by 2022.

The company will then look to expand the plant’s capacity to 1 million tpy but has not disclosed the timeline for this and has said this depends on "internal and external demands for the product."

Taraz is in the south of Kazahkstan, close to the border with Kyrgyzstan, 500km west of Almaty, which is Kazakhstan’s biggest city.

The 1-million-tpy plant is medium-sized compared with its European counterparts. Tata Chemicals has a 400,000 tpy plant in the United Kingdom and Ciner Group has a 2.5 million tpy facility in Turkey.

But the market could remain tight. Despite the new capacity in the pipeline, the global market continues to grow at 2-3% per year.

Market tightness has been caused by continued growth in consumption which has outstripped supply.

Some producers believe the current price of soda ash is not high enough to warrant significant effort in new capacities to meet this growing demand.

The price for soda ash, natural and synthetic, dense and light, large contracts, delivered Europe was €195-230 ($218-258) per tonne on March 28.

This was up from $190-210 per tonne in October, a price rise which has been caused by the market imbalance.