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    Sulphur 416 Jan-Feb 2025

    31 January 2025

    Market Outlook

    Historical price trends $/tonne

    SULPHUR

    • Sulphur prices may remain stable before decreasing on muted demand and transactions may increase in frequency contributing to price decreases in the first half of 2025.
    • Price weakness in late 2023 was driven by overstocked consumers, stable supply volumes and high freights. Prices started increasing in 2024 Q2 but remained lower than the 2023 average. Slower stock drawdowns and reduced Chinese inventory has pushed sulphur prices higher.
    • Sulphur supply increases are dominated by growth in the Middle East, which will allow new production to reach the traded market rapidly. High phosphate prices in 2024 H2 has maintained support for sulphur prices.
    • Demand growth is expected to exceed the supply growth rate, pushing the market balance to deficit and increasing prices. The requirement for stock drawdown will increase the marginal cost of supply and provide support to sulphur prices.
    • A programme of intentional stock drawdown in Saudi Arabia and Kazakhstan, along with high Chinese port stocks, will limit how fast the market can rebalance and move to deficit. However, a return to tighter market conditions and higher sulphur prices forms the base case forecast.

    SULPHURIC ACID

    • The current global sulphuric acid prices are being kept largely stable by the presence of subdued demand which has offset the tight availability in regions like Northwest Europe. However, both demand and availability are set to return to more normal levels later into Q1.
    • Sulphuric acid prices are expected to gradually decline in the first quarter of 2025. Subdued demand is currently offsetting tight availability. This has kept the prices largely unchanged for most of the past year. However, demand is anticipated to pick up in the initial two months of 2025, possibly coinciding with the return of supply.
    • Prices for Northwest Europe have held for three weeks and could continue to do so as supply is not expected to return until later in Q1. However, a lower price could stimulate market activity, according to some market players. According to CRU’s latest short-term forecast, prices are expected to average $105/t in February and $95/t by March.
    • In India, Adani Enterprises is on track to commence operations at its 500,000 t/a copper smelter by the end of Q1. It is expected that the copper smelter will produce around 1.5 million t/a of sulphuric acid. Similarly, Paradeep Phosphates Ltd (PPL) is scheduled to commission its 4,000 t/day sulphuric acid plant by the end of Q2. Market participants remain cautious due to an anticipated influx of domestic sulphuric acid. In the short term, limited activity is expected to persist until later in Q1 ,after which an uptick in activity is expected. Flat demand in Chile is expected to last at least until February.

    Latest in Commodity

    Cartagena refinery enters solid sulphur market

    Cartagena Refinery has entered the solid sulphur market, diversifying its petrochemical portfolio, according to a company statement on 21 May. The first shipment of 260 tonnes has already been dispatched to the domestic market. This new venture is enabled by a recently commissioned pelletising plant that converts liquid sulphur into solid pellets, with a production capacity of 1,000 t/d. The refinery is targeting Colombia’s fertilizer, chemical, and mining industries, and is also planning to export to international markets, including Brazil, Peru, and countries in Africa.

    Gazprom and PhosAgro sign new five-year sulphur deal

    Russian gas producer Gazprom and fertilizer giant PhosAgro have signed a new five-year agreement for the supply of sulphur, according to a report from Interfax on 5 June. The deal, signed at the St. Petersburg International Economic Forum (SPIEF), will see Gazprom continue to supply the key raw material for PhosAgro’s phosphate fertilizer production. The document was signed by Gazprom Deputy Chairman Vitaly Markelov and PhosAgro CEO Alexander Gilgenberg.

    Russia bans rail transport of Kazakh sulphur

    Russia has ordered a “temporary cessation” of rail transport of all sulphur originating from Kazakhstan that is destined for Russian seaports and railway checkpoints, representing a significant policy shift, according to an official order from the Federal Agency for Railway Transport (Roszheldor). The directive, which took effect from May 26th, orders a halt to the loading and movement of Kazakh sulphur “until further notice.” While the measure is officially described as temporary, the order provides no specific timeline for when the transit might resume. The action cites instructions from Russia’s First Deputy Prime Minister, D.V. Manturov, as its basis.

    Nickel Industries starts up ENC acid plant

    Nickel Industries announced started up the sulphuric acid plant at its new Excelsior Nickel Cobalt (ENC) HPAL project in the final week of June. The ENC Project is a massive, multi-billion dollar high-pressure acid leach (HPAL) facility located in the Indonesia Morowali Industrial Park (IMIP) in Central Sulawesi, Indonesia. It is operated by Australia’s Nickel Industries to supply battery-grade materials for the electric vehicle (EV) market. At capacity, it is expected to yield roughly 72,000 t/a of contained nickel equivalent as mixed hydroxide precipitate (MHP), nickel sulphate, and nickel cathode.