Effective April 1, 2026, China will abolish the VAT export rebate policy for certain products including photovoltaic glass. As the core upstream raw material for photovoltaic glass, the soda ash market is closely monitoring whether the potential “export rush” for photovoltaic glass before the policy takes effect can substantially improve the current oversupplied soda ash market. Overall, this policy is expected to stabilize soda ash prices in the short term, though its impact on the glass market will be relatively limited. Soda ash prices are likely to outperform the glass market during this phase. In the medium to long term, however, the fundamentally weak outlook for both markets remains difficult to fundamentally reverse.

Rush Exports Resurface in Photovoltaic Glass

This adjustment to export tax rebates is not sudden but follows a clear, gradual progression. On January 9, 2026, the Ministry of Finance and the State Taxation Administration jointly announced that VAT export tax rebates for photovoltaic products and others would be abolished effective April 1, 2026. For battery products, the policy adopts a phased adjustment approach: from April 1 to December 31, 2026, the VAT export tax rebate rate for batteries will be reduced from 9% to 6%; Commencing January 1, 2027, export VAT rebates for batteries will be fully eliminated. For products subject to consumption tax listed in the policy, export consumption tax policies remain unchanged, continuing to apply tax rebate (exemption) arrangements.

Notably, the term “glass” appears multiple times in the adjustment list, but primarily concerns processed glass such as household glass and tempered glass, with limited overall impact on float glass supply and demand. Global photovoltaic (PV) market demand is currently growing at a moderate pace, though emerging markets maintain relatively rapid expansion. Traditionally, the first quarter—particularly around the Chinese New Year—represents a slow season for PV installations both domestically and internationally. However, driven by expectations of the tax rebate elimination, the first quarter may witness a resurgence of “export rush” activity for PV modules, creating an atypically busy off-season.

As a key material accounting for over 10% of module costs, photovoltaic glass will directly benefit from increased module exports, with its direct exports also expected to rebound. According to MTEF statistics, China's cumulative photovoltaic glass exports reached 4.1525 million tons from January to November 2025, marking a 26.16% year-on-year increase and demonstrating strong export potential.

Turning to the soda ash demand side, PV glass is a key downstream application, consuming approximately 0.2 tons of soda ash per ton of glass produced. Currently, the industry's overall capacity utilization rate remains relatively low, exhibiting signs of overcapacity, which limits the demand pull from new production facilities. However, existing plants still have room to increase utilization rates.

Data indicates that as of January 14, 2026, the photovoltaic glass industry's capacity utilization rate has dropped to a low of 66.31%, down 26.57 percentage points from the same period in 2024 and 0.88 percentage points lower than the same period in 2025. Although photovoltaic glass manufacturers currently maintain high inventory levels of 30-40 days and there remains a buffer period of over 70 days before the export tax rebate policy takes effect, production and sales of photovoltaic glass are expected to receive a temporary boost amid policy adjustment expectations. This could provide short-term support for the soda ash market.

Medium-to-Long-Term Soda Ash Prices Remain Under Pressure

Persistently weak demand for float glass continues to weigh on the soda ash market. As one of soda ash's primary downstream sectors, float glass has entered its seasonal off-peak period. Combined with the lack of significant recovery in the real estate market, this will continue to suppress soda ash demand growth, preventing the short-term boost from photovoltaic glass from translating into sustained support.

Soda ash export growth helps alleviate inventory pressure. According to Longzhong Information data, China's cumulative soda ash exports from January to November 2025 reached 1.9612 million tons, surging 88.82% year-on-year. During the same period, cumulative imports amounted to only 21,700 tons, plummeting 97.76% year-on-year. However, soda ash inventories remain elevated. As of January 12, 2026, total domestic soda ash manufacturer inventories stood at 1.5647 million tons, declining only marginally by 0.80 thousand tons (0.51%) from the previous week. Light soda ash inventories reached 844.00 thousand tons, increasing by 0.75 thousand tons week-on-week; while heavy soda ash inventory stood at 720,700 tons, down 15,500 tons week-on-week, indicating a slow overall destocking process. Concurrently, the soda ash production-to-sales ratio declined significantly, with last week's shipment rate reaching only 78.18%, down 26.15 percentage points week-on-week, reflecting persistently weak terminal demand.

Supply-side pressures are also gradually mounting, further exacerbating the industry's supply-demand imbalance. With the continued ramp-up of production capacity at Inner Mongolia Boyuan Yinggen and the resumption of operations at Henan Jinshan, soda ash supply is expected to increase further. Data indicates that as of January 8, 2026, the comprehensive capacity utilization rate for soda ash stood at 84.39%, up 4.4 percentage points from the previous week.

Supply-side pressures are also gradually intensifying, further exacerbating the industry's supply-demand imbalance. With the continued ramp-up of production capacity at Inner Mongolia Boyuan Yinggen and the resumption of operations at Henan Jinshan, soda ash supply is expected to increase further. Data shows that as of January 8, 2026, the comprehensive capacity utilization rate for soda ash stood at 84.39%, up 4.43 percentage points from the previous week. Specifically, the capacity utilization rate for the ammonia-soda process reached 90.41%, up 11.20 percentage points week-on-week, while that for the combined process stood at 74.11%, rising 1.33 percentage points week-on-week. The overall capacity utilization rate for 15 enterprises with production capacities of one million tons or more was 88.15%, an increase of 2.24 percentage points week-on-week. Against this backdrop, even if demand experiences temporary boosts, they can only partially alleviate supply-demand imbalances and are unlikely to reverse the industry's medium-to-long-term pressure.

Overall, the “rush to export” effect triggered by the cancellation of export tax rebates for photovoltaic glass will inject some vitality into the soda ash market in the short term, but it cannot reverse the industry's pattern of strong supply and weak demand. Future trends in the soda ash market will still depend on plant operation conditions, macroeconomic changes, and cost trends.

As an integrated internet platform providing benchmark prices, on January 16, the benchmark price of heavy soda ash, according to SunSirs, was 1214.29 RMB/ton, a decrease of 0.93% compared to the beginning of the month (1225.71 RMB/ton).

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