Why did liquid chlorine prices crash to negative values in China and what does this mean for buyers?

Why did liquid chlorine prices crash to negative values in China and what does this mean for buyers?
Chinese liquid chlorine prices turned deeply negative in June, with Shandong quotes ranging from -50 to 200 yuan/ton and extreme lows near -150 yuan/ton. This collapse stems from the chlor-alkali co-production structure: every ton of caustic soda yields 0.886 tons of liquid chlorine, which cannot be stored and must be sold daily via pipeline. Downstream consumers—propylene oxide, epichlorohydrin, and dichloromethane—all fell into losses, slashing operating rates and refusing to buy high-priced chlorine. With both caustic soda and chlorine weak, integrated ECU margins flipped negative, forcing plants into 'passive maintenance' cuts. Historically, such extreme conditions triggered industry-wide shutdowns when ECU profits hit -435 yuan/ton in June 2022. The current situation suggests supply-side rationalization is underway, but the market bottom depends on how quickly capacity adjusts.