Sulphur Prices (Q1 2022)
The market dynamics for sulphur in the Asia Pacific region experienced a substantial gyration in the first quarter of 2022, as Russia began its special military operations in Ukraine. The price of crude oil increased as western nations became more hesitant to purchase Russian supplies, and queries focused on the middle-eastern market. As a result, the crude offers have had an impact on the APAC sulphur market.
Because of the geopolitical upheaval in eastern Europe between Russia and Ukraine, the European region is the most affected market. As a result of the sanctions, Russia became isolated on the global financial arena and lost its ability to arbitrate with the European Union. In contrast, European countries were hesitant to purchase Russian energy materials in protest of Ukraine's invasion. The current energy crisis has had a significant impact on market dynamics, and the Suez Canal Authority increased costs by 5%, further inflating sulphur prices in the European market. In mid-March, the CFR Hamburg pries exceeded the 450 USD/MT level as a result of the ripple effect.
The market in the North American region remained consolidated in the first quarter of 2022, owing to strong crude offers throughout the quarter. Even after the revival of Omicron, the OPEC+ alliance continued to its resolve to progressively increase crude oil supply, which helped to keep market sentiments in the US domestic market buoyant. Agricultural and chemical intermediate demand, on the other hand, remained consistently strong as China and Russia imposed limits on raw material exports and the growing food price index changed the dynamics and maintained bullish views in the regional market. During the quarter, the CFR Texas negotiations for Sulphur granular were settled at 460 USD/MT.
Sulphur Prices (Q4 2021)
Ministerial-level talks completed after the OPEC+ Alliance to gradually raise Crude Oil production output. The APAC sulphur market witnessed a considerable upswing in producer quotations, which was driven by continually increasing downstream demand. In contrast, high freight costs combined with rising prices encouraged ASEAN customers to postpone imports, reinforcing the wait-and-see attitude in their domestic market. The offers, however, took a little dive in the second half of the quarter, owing to the return of COVID 19's omicron version. The CFR Shanghai quarterly average discussion for sulphur granular grade was assessed at 312 USD/MT as a result of the ripple effect.
The North American market witnessed a mixed trend in the fourth quarter of 2021, the producer's offer for the chemical remained consolidated after observing significant growth in the previous quarter. The domestic market sentiments were uplifted after Biden’s Administration announced to release the strategic Petroleum reserves as part of ongoing efforts to lower the prices of Crude Oil in the fourth quarter. As a ripple effect of the persistent demand from the downstream players, the CIF Texas quarterly average was assessed at 371 USD/MT.
In the South American region, especially in Brazil, the price was 313 USD/MT, 338 USD/MT, and 318 USD/MT in October, November and December, respectively. It was due to the increased prices of crude oil and supply and demand imbalances.
Sulphur Prices (Q1-Q3 2021)
Despite limited demand from end-user sectors, prices continued to rise across Asia. Lower output from the US due to the extreme cold resulted in a global shortage of most primary chemicals, including sulphur, while demand for crude-based sulphur in the global market was high, supporting its prices in Asia. As oil prices continued to rise in March, the CFR price in Indian markets hovered around 199.93 USD/MT, up from 167 USD/MT in January. After the Lunar New Year holidays, a similar scenario occurred in China, when prices rose due to a domestic scarcity.
The demand from downstream businesses remained strong during this quarter, causing prices to rise continuously. In the Chinese market, an unusual increase in offtakes from downstream fertiliser factories, combined with a severe shortage, caused prices to skyrocket. Meanwhile, in India, a similar situation was witnessed, with downstream fertiliser plants maintaining large offtakes to meet total demand. As a result, the Indian and Chinese markets saw increases of more than 10% and 8%, respectively, in May, with prices settling at 246.8 USD/MT and 224 USD/MT in India and China, respectively.
In the third quarter of 2021, prices increased significantly in the Asia Pacific region. Due to increased demand from downstream fertiliser manufacturers, prices in the Chinese domestic market skyrocketed in the third quarter. As a result of the energy problems in Europe and China, global fertiliser costs surged to new highs in Q3, prompting more scrutiny. The market sentiments in India were diverse in different parts of the country. Traders in Mumbai and Vadodara reported strong demand and continuous offtakes of sulphur, but no notable price changes were noted in September due to greater stockpiles. Prices in the country have been steadily declining due to rising inventory levels at BPCL.
Sulphur was in short supply on the European market, despite strong demand from downstream industries. During this time, supply was still limited due to scheduled and unplanned shutdowns at key refineries in France and the United Kingdom. Furthermore, a container shortage and high shipping freight increased its prices, prompting overseas dealers to avoid the European supplies.
In Q3 2021, the region market outlook for sulphur showed mixed sentiments. Downstream markets saw a price increase on Monday, September 20th, with fresh record spot gas highs and no meaningful price relief for fertiliser manufacturers. Throughout the quarter, downstream fertilisers and the sulphuric acid industry saw an increase in demand. A number of European fertiliser facilities were forced to shut down due to record-high Dutch TTF and British NBP gas costs, but the British government stepped in with short-term financial assistance, allowing one of CF Industries' two UK fertiliser plants to reopen.
As a result of the cold snap that affected the US Gulf Coast (USGC) area in mid-February, North America's crude-based sulphur output was heard to be reduced. Due to unfavourable working circumstances caused by the frigid weather, most refineries remained closed in February, resulting in a major reduction in its output, which supported prices. Although downstream demand for the chemical remained low, due to a lack of supply and rising crude derivative prices. The price jumped by 5 USD/MT in February and stayed stable until the end of March at 135 USD/MT.
Prices of sulphur in North America fluctuated on a monthly basis during the second quarter, as the demand and supply gap changed month to month. Several refineries reopened in April after being down for a long time owing to the harsh winter of February, effectively improving the country's supply. Prices fell sharply in May, as crude-based sulphur supplies from domestic refineries were quickly restored. Despite the improvement in supply chain activity, prices rose marginally in the second half of Q2 due to increased demand from the downstream fertilisers market. As a result, prices in the United States increased a little from 161 USD/MT to 162 USD/MT in mid-June.
The third quarter of 2021 saw an increased trend in North American pricing, which was followed by continuous demand from downstream industries. In terms of supply, the third quarter saw an improvement as refinery utilisation rates remained stable at pre-pandemic levels. In Q3, demand increased, owing primarily to downstream sulphuric acid producers, fertiliser, and industrial sectors. Following the recovery from the catastrophic weather in the United States, the supply and demand balance improved dramatically, resulting in a large increase in Sulphur prices in Q3 2021.
The price in the Brazilian market had increased during the first three quarters (from January to September) from 232 to 306 USD/MT. It was due to overall global market's increase in prices due to high demand and also the recovery of the economy after COVID.
Sulphur Prices Overview 2020
In India, the crude oil sector is the primary source of sulphur. The market had conflicting views towards the end of September, with ample supply and a resurgence in downstream demand. China's regular stock increased from 1 million tonnes to 3 million tonnes. Due to pent-up downstream demand for detergents and fungicides, its consumption in India and China has surged. Despite the fact that demand was still bearish in Q3 of 2020, it was still much above the previous quarter's record lows. Prices maintained in the 90-92 USD/MT CFR China area.
As a result of Covid-19, plant turnaround times were extended, limiting the supplies across the European market. The supply was also delayed by the stress of switching to a low-sulphur gasoline as part of a slew of government programmes aimed at alleviating rising environmental concerns. Despite the fact that demand was constant in Q3, low offtakes from the downstream capro sector slowed the overall demand fundamentals. With the economy on the mend, demand for the chemical from various downstream industries is expected to pick up significantly in the coming quarters. Overall, there was a reduction in its supply due to new IMO 2020 restrictions. The price was 170.90 USD/MT.
The majority of market operations in the United States were paused at the end of August due to Hurricane Laura's threat to the US Gulf Coast. The disruption of logistics has a direct impact on its supply across the United States. In mid-September, Suncor Sulphur announced a planned maintenance turnaround, exacerbating the supply situation in the final weeks of September. Despite the fact that burners were running at peak efficiency in concert with high demand, a big fertiliser manufacturer was heard reporting a massive increase in the chemical’s inputs. However, the US sulphur market's export revenues were constrained due to limited output. Prices had dropped from 51 USD/MT to 40 USD/MT from the previous year. It was due to the COVID-19 shutdowns that the prices fell.
Prices began to fall at the end of each quarter in 2019, and they gradually increased in 2020, beginning in January at 75 USD/MT and ending in December at 152 USD/MT. It was due to an overall stable market in the world but the prices increased from last year.
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Sulphur is basically a chemical element, which is known to be the 10th most abundant element in the universe. It is multivalent, as well as nonmetallic. In appearance, the elemental Sulphur is a bright yellow crystalline solid at room temperature. It is most widely used in the production of sulphuric acid, which in turn goes into fertilisers, batteries and cleaners.
Molecular Formula of Sulphur:
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The displayed pricing data is derived through weighted average purchase price, including contract and spot transactions at the specified locations unless otherwise stated. The information provided comes from the compilation and processing of commercial data officially reported for each nation (i.e. government agencies, external trade bodies, and industry publications).