Ambarish Mukherjee

New Delhi , Oct. 3

GHCL Ltd on Monday increased the price of soda ash by Rs 400 per tonne, from the present Rs 9,200 to Rs 9,600 per tonne.

Soda ash is one of the main inputs for manufacturing glass and detergents. The other two big soda ash makers, namely, Tata Chemicals Ltd and Nirma Ltd are expected to follow suit.

While Tata Chemicals is the dominant player with close to 40 per cent market share, GHCL and Nirma enjoy around 20-25 per cent of the domestic market share each. The remaining is mainly catered to by small producers.

Tata Chemicals has not yet effected any price increase. The company Managing Director, Mr Prasad Menon, refused to comment on the price hike issue.

According to a spokesman of GHCL, the company is forced to increase the price because of increasing petroleum prices and increased cost of power. "Logistics is very important for us and increase in petroleum prices has resulted in increase in transportation costs, which is one main reason for price hike. Also, in the last State Budget, the Gujarat Government had increased electricity prices sharply which were not passed on to the consumers fully. That is why we are now increasing the prices," the GHCL spokesman said.

According to industry officials, the price hike is in line with the prevailing trend in the global soda ash market. The domestic industry normally prices its product at a marginally lower rate compared to the landed cost of soda ash. The current ruling international price is approximately around $200 per tonne. But when the shipping cost is included with this $200, the domestic price would still remain lower for domestic users of soda ash compared to imported soda ash, company officials said.

Meanwhile, the share price of Tata Chemicals rose sharply today to close at Rs 200.95 after opening at Rs 191.90 on the NSE. GHCL opened on the NSE at Rs 102, went up to Rs 104.5 before closing at Rs 101.75. Nirma opened at Rs 467.75 and closed at Rs 469.

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