When I looked up recent Japanese chlor-alkali statistics, I expected to see a decline, similar to the European production discussed in the previous blog-post https://saltmarketinfo.com/the-european-energy-crisis-is-impacting-the-salt-market/. As in Europe, natural gas has an important share in the Japanese electricity production. To my surprise, the rising cost of LNG in Japan has no obvious impact on Japanese chlor-alkali production as shown in the graph below.
A closer look at the price increase of natural gas, and LNG in Europe and Japan explains the difference.
The European increase of natural gas prices is 3 times higher than the Japanese increase, which obviously allows Japanese producers to remain competitive. LNG supply is balanced with demand, and its price increase was relatively modest. Europe cannot replace all of its lost pipeline supplies with LNG due to a lack of infrastructure, and gas price increases have been very significant. Good reasons for Germany to look forward to new LNG infrastructure.