Inventory remains high, and the short-term oversupply of caustic soda is still difficult to shake.

Since March, the conflict between the US and Iran has intensified, driving the overall strong performance of the chemical industry sector. This has led to the continuous strength of caustic soda futures at the beginning of the month, but there has been a significant decline starting this week. Although export orders have improved, it is still difficult to see a significant increase in short-term exports. In reality, the gradual release of newly added caustic soda production capacity has resulted in high inventory levels, and the short-term oversupply situation is expected to remain unchanged. In addition, the high contango of the 05 contract may increase warehouse receipt registration, and delivery pressure will also put pressure on the near-month 05 contract. Therefore, it is recommended to sell on highs for the caustic soda 05 contract at present, with reference to the operating range of 2150-2550 yuan/ton for the caustic soda 2605 contract.