Sodium Carboxymethyl Cellulose (CMC) is a kind of modified cellulose which is widely used in food, detergent, paper making, textile and oilfield industries. It is known as “industrial monosodium glutamate”. China’s production of Sodium CMC begins in 1960 and now it is the largest production country in the world which occupies about 56% of total output. Below are some of my personal opinions about Sodium CMC market in 2021.
1. Decline of total output
Since COVID-19 spreads all over the world, most activities were canceled in 2020 and the market demand goes down a lot. Meantime, along with rapid increase in production quantity in the last 30 years, the total output is over 650,000 tons now while actual market demand is around 410,000 tons – supply exceeds the demand. Along with the market change and domestic industrial restructuring, all main manufacturers decide to cut back their production.
2. Influence of rise in domestic raw materials price and freight
Chinese raw materials price has been rising sharply since Oct. 2020, including Sodium CMC . Meantime, freight goes up abnormally which leads to international marketing change. American and European customers tend to buy locally at almost the same even lower price compared to direct import.
3. Expectation and suggestion of Sodium CMC marketing
How to deal with such depressed market? From my personal perspective:
Considering current depressed market will last for a long time, I think all of our cellulose industry should unify together and take some active methods to solve it. For example, reducing output and keeping CMC price at suitable level to avoid abnormal price competition, improving R&D ability and optimizing production process to produce high performance and higher quality Sodium CMC can win high-end market. I believe that market will prosper again after 2-3 year’s revolution.