29 February 2008 13:52 [Source: ICIS news]
LONDON (ICIS news)--Sulphur demand from key buyer China has cooled off in the face of high prices, bad weather, holidays and the government’s ban on the movement of diammonium phosphate (DAP) to the ports for export, market sources said on Friday.
International sulphur prices have risen rapidly over the past few months, driven mostly by strong demand from Chinese buyers facing a reduction in volumes from international suppliers this year.
Spot prices in
However, buyers were very reluctant to pay these new higher levels as a number of factors had combined, not least the higher prices, to ease demand.
The recent Lunar New Year holidays and bad weather have meant that sulphur stock levels have built up at the ports.
This week’s decision from
This decision was pushing all phosphates production towards the domestic market to avoid a potentially disastrous shortage. However, phosphate producers were unable to pass on higher sulphur costs to the lower priced domestic market.
Domestic DAP prices were currently in the mid-$570s/tonne ex-works.
Suppliers, however, were confident that Chinese spot demand would return. They noted that the stocks at the ports and plants would be used up quickly now that the holiday season was over and bad weather had cleared.
Sources commented that while price appeared to be a sticking point at the moment, sulphur demand would remain strong in order to provide the domestic market with sufficient phosphate fertilizer for the spring season.
($1 = €0.66)
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