Ciech confirms end to soda ash production at Romania plant

By Michael Greenfield
Published: Friday, 01 November 2019

A price rise of 120% for steam supplies has led Poland-based chemicals producer Ciech to suspend production at its plant in Romania while it explores its options.

Poland-based chemicals producer Ciech’s soda ash plant in Romania was scheduled to stop production on September 18, but the company will continue to look for an alternative supply of steam for its factory so it can resume production.

Steam supply is required to produce synthetic soda ash, and CET Govora, the local steam producer, has imposed a 135% increase in the price of its contracted supply. This caused Ciech to announce that soda ash production would be suspended.

Although that figure has since been negotiated down to a 120% rise, "Ciech is not able to accept any increase in relation to the current price level because it would result in permanent unprofitability of its business operations," the statement said.

Ciech will use this enforced outage to maintain equipment, the company said.

The company had previously told Fastmarkets that it was considering a joint venture to create its own source of steam.

Ciech’s Romania plant has capacity for 600,000 tonnes per year of soda ash but before this new outage it had been producing only 400,000-450,000 tpy, according to two sources.

The plant appears likely to stay out the market until the beginning of 2020 while the company assesses options for a steam supply.

Soda ash vendors are agreed that price increases will be applied to annual contracts after negotiations, and one producer believed that the market will be tighter once Ciech’s plant has come out of the market, although that would be offset by a recent slowing of demand.