Chlor-Alkali is by far the largest -end use of salt

The chlor-alkali industry consumes about 40% of the all salt globally to produce chlorine and caustic soda. Most of the chlorine is used to produce PVC, which in turn mainly ends up in building products. Demand of salt therefore ties to the global construction markets. The construction industries of the US and China grew significantly between 2010 and 2022, and were responsible for an important part of the growing global salt consumption in the same period.

Growth indicators of the construction industry in China and the US in the 2010 – 2022 period.

Regional trends in chlor-alkali

China, the US, Europe and Japan are the biggest producers of chlorine. Together they account for about 85% of the global output. Chlorine production in the US and in China grew after 2010, whereas producers in Europe and in Japan produced less. The chart below illustrates the production trends for the 4 world regions between 2010 and 2023.

Chlorine production indices for the USA, Europe, China and Japan. (2010 = 1; Source: National and Eurochlor production statistics)

Chloralkali producers in the US, Europe, China and Japan use different types and sources of salt. The industry uses salt in brine and also crystalline salt. In some regions, chlor-alkali producers obtain brines or crystalline salt from nearby local sources. Other regions source salt through imports from distant suppliers. In all 4 regions, the chlor-alkali industry is by far the largest end-user of salt. In contrast, the impact of the chlor-alkali industry on the regional salt markets differs markedly. The following discussion will provide an outlook on the different regional perspectives for the chlor-alkali industry, and it discusses the impact of the different sourcing types on the global and regional salt markets.


Chlorine production in the US increased from 2010 to 2019. Low prices of natural gas and electricity put US producers in an advantageous competitive position for chlorine downstream products in the world market. The COVID pandemic in 2019, and more recently high inflation rates, led to a slowdown of the US economy, and to decreasing chlorine demand. As of Q3 2023, the US economy, and also the construction markets begin to recover. US chlor-alkali demand is expected to grow over the next years, because of its competitive energy prices, and the recovery of domestic demand. Chlor-alkali producers in the US use mainly salt in brine from local sources. Despite its huge share in the regional salt market, the industry has virtually no impact on the regional or global markets for crystalline salt.     


European chlorine production decreased after 2010. The conversion from mercury – to membrane technology end of 2017 led to the permanent closure of a part of the chlor-alkali production capacity. Economic downturn because of COVID, was followed by the attack of Russian the Ukraine and a subsequent drastic increase of European electricity prices. Producers struggled to remain competitive, and capacity utilization rates fell to 60%. In the past year, electricity prices decreased, but chlor-alkali production remained low. Over the next years, the European chlor-alkali industry is expected to recover only slowly. Captive regional demand remains low with a continuing economic crisis, and insecurity about future electricity prices. European chlor-alkali producers use some salt in brine, but to a larger extent they use crystalline high purity salt. Continuing low demand from the chlor-alkali industry is likely to result in long supply and reductions of the current high price level.


The Japanese chlor-alkali production decreased after 2010 with a stagnating domestic market. Other than in Europe, the industry is less concerned about future electricity prices because of a high share of captive electricity supply. Production is estimated to remain stable over the next years. The Japanese chlor-alkali industry imports crystalline salt, and has a sizeable impact on the global export market for crystalline high purity salt. The country is expected to continue salt imports at current levels. It is unlikely that Japan will absorb additional volumes from growing export oriented capacities in the foreseeable future.   


After many years of strong growth, the Chinese chlorine production has slowed down recently. Sluggish demand for PVC will continue with the ongoing turmoil of the Chinese real estate and construction industry. China is by far the largest importer of high purity crystalline salt for chlor-alkali producers in the coastal areas. Production capacities for the international export market that are currently being built, are mainly targeting the Chinese chlor-alkali market. Chinese import prices have started to decline from record high levels in 2022, and the price erosion could continue as additional export oriented production capacities are brought on stream.     


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