Page 133 - CW E-Magazine (3-9-2024)

Point of View

Can sustainable transportation emerge as a signifi cant

new driver for caustic soda demand?

Caustic soda – co-produced along with chlorine and hydrogen in an unalterable ratio – is a basic chemical for which demand grows
at best around growth in GDP. Globally, alumina refining for aluminum smelting is the largest caustic soda consumption segment,
followed by organic & inorganic chemicals manufacturing (such as isocyanates, polycarbonates, and titanium dioxide).

In North America, and in some European countries, pulp & paper is also an important driver. Caustic soda plays a crucial role in
the pulping and bleaching processes, which are part of the process of transforming wood into paper. In the former, caustic soda helps
in breaking down the lignin in wood and then separates cellulose fibres to produce the pulp. In the latter, caustic soda is utilised to
remove residual lignin and brighten the pulp.

In Australia and some other places, the alumina industry, processing bauxite to serve aluminium manufacturing, accounts for a
sizeable chunk of caustic soda demand.

In India too the alumina sector is an important outlet for caustic soda, accounting for about 14% of total demand. But the textile
industry dominates here, with a 20% share of demand. In this, caustic soda is used for scouring (to remove unwanted materials from
cotton fabric), mercerization (to increase the strength, lustre and dye affinity of the fabric), and dyeing (to control pH at optimum levels).
To no surprise, the pulp & paper sector is not very significant in India, partly due the fact that we do not have large managed forests.

The advent of electric vehicles (EVs) has in recent times led to a spurt in demand for several critical minerals and metals, and the
processing of quite a few of them requires caustic soda. This has gotten some industry analysts excited about future prospects for
the mature alkali industry, and varying projections are being made of the contribution that can emerge from this high-growth sector.

But there are many uncertainties here – in the choice of mobility technology that will dominate; the kind of battery chemistries that
will emerge; and the chemical routes to get to the materials and chemicals needed. All of this makes pinning down the opportunity
challenging.

Material needs of the energy transition
The ongoing energy transition is here to stay, and underpinned by several drivers. At the top of the list is the emphasis on
sustainability (net-zero aspirations) of economies and companies, as well as the desire in several countries to augment energy security.
In India, policies and regulations have been framed with the aim of raising the level of energy self-sufficiency, and electrification of
mobility (along with several other options) is seen as a key tool.

One worrisome aspect (all the more so in India) is that the energy transition requires several materials, many of which are not
widely and/or readily available. The well-known of this lot are aluminium, cobalt, copper, graphite, iron, lithium, manganese, nickel,
rare earth elements (REEs), and tin. Batteries, for example, require all of these, albeit to varying extent (depending on the type of
battery), while green hydrogen and fuel cells need all but lithium and REEs. Solar panels require in the main aluminium, copper, iron,
nickel and tin. Viewed another way, REEs are crucial for batteries, semi-conductors, magnets and motors.
In addition to these usual suspects, there are several lesser-known materials that are just as critical – antimony, boron, chromium,
fluorspar, molybdenum, niobium, silicon, tantalum, titanium and vanadium. Vanadium, for example, is needed for batteries,
semi-conductors, energy storage, hydrogen production, and for steel alloys.

Geological resources for many of these materials are limited to some parts of the world, and some are not currently available in the
scale at which they could be needed in the future. No doubt with the right market signals their availability will rise to meet demand,
but the growth in supply will be slow and not steady.

Caustic soda use for making and substituting lithium
The battery industry has today become the dominant use sector for lithium, accounting for about 86% of total lithium demand,

Chemical Weekly September 3, 2024 133

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