The Outlook Sulphur and Sulphuric Acid monthly report forms part of the comprehensive and trustworthy coverage of the Fertilizer markets. The unbiased news and analysis includes sections on market overview, key drivers, regional updates, supply and demand outlooks as well as forecasts and any other factors driving prices. If you are involved with these or related markets, this independent and essential business tool can help you to make crucial strategic decisions. Integer Research produces the Outlook reports on behalf of ICIS.
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The Outlook Sulphur and Sulphuric Acid: Market overview
Updated to Q4 2016
The outlook for the global sulphur market in Q4 looks a little uncertain following a rather flat Q3. A backdrop of lower prices for phosphates, caused by weak demand and the oversupply of the fertilizer has prevented sulphur prices firming for much of 2016 and this trend is expected to continue.
Despite claims of sold-out positions and tight availability from major sulphur exporters in the Middle East, most international traders do not expect to see prices firming. However, in India demand has picked up and following a dearth of purchase tenders, FACT, Coromandel and MMTC are looking to secure material since domestic prices are now at parity with import cargoes.
The Brazil contract price was agreed at similar levels to Q3, but discussions between buyers and sellers in North Africa and Europe for Q4 contracts continue. North African buyers are pushing for reductions because of price pressure in the downstream DAP and MAP markets, while European buyers for the production of caprolactam (capro) want their contract price to move more in line with international sulphur values. The outlook for the metals markets and the fibres sector also is also a little uncertain because poor macroeconomics. In addition, cuts in capro are expected to lead to additional sulphur availability. The Barzan project in Qatar is expected to add some additional cargoes to the market in Q4 which could create some price pressure. Kashagan in the Caspian Sea sent its first crude export since the project started 16 years ago. It remains to be seen how soon sulphur from Kashagan will be seen offered in the international market.
Updated to Q4 2016
The global sulphuric acid market is expected to be somewhat balanced during the fourth quarter as planned maintenance in Asia takes volumes out of the market.
Three northeast Asian smelters will undergo maintenance during the quarter with the region expected to be relatively balanced.
However, tough negotiations are expected during the quarter, as buyers in all regions agree for yearly and half-yearly contracts.
Moroccan buyer OCP is expected to average around 114,000 tonnes/month in import demand to close out the year. The buyer is understood to have withdrawn from the spot market and is buying directly from producers. OCP imported more than 1m tonnes from January to September.
Demand from Latin American regions, especially Chile, has remained low and annual contract agreements are expected to be settled at significantly lower levels than 2015.
Demand from Brazil is expected to see at least four more cargoes secured to close out the year and see competition between tonnes from Mexico’s Boleo sulphur-burner acid and European smelter acid.
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The Outlook Sulphur and Sulphuric Acid news & analysis
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The Outlook Methodology
About The Outlook Sulphur and Sulphuric Acid
Sulphur is used in fertilizers, normally in the form of ammonium sulphate, where there is a deficiency of sulphur in the soil.
Sulphur is also used to make sulphuric acid from sulphur dioxide. Sulphur dioxide is used to make dyes and as a bleaching agent.
Sulphur has a pale yellow appearance and has a slight odour of rotten egg. It is insoluble in water, but soluble in carbon disulphide.
It is found in meteorites, volcanoes, hot springs, and as galena, gypsum, Epsom salts and barite. It is also a minor constituent of fats, body fluids and skeletal minerals.
There are two key sources of processing sulphur. The first is the Frasch process, where sulphur is extracted from underground without mining it.
In the Frasch process, underground deposits of sulphur are forced to the surface using superheated water and steam (to melt the sulphur) and compressed air. This gives molten sulphur, which is allowed to cool in large basins. Purity can reach 99.5%. The process is energy intense.
Another source of sulphur is as a by-product of processing crude oil and natural gas, which contain hydrogen sulphide. It is produced in crush lump, flake and prilled form.
Key industrial uses of sulphur includes production of black gunpowder, asphalt, vulcanisation of natural rubber, as a fungicide and as a fumigant, use in the bleaching of dried fruits and for paper products.
A key use of sulphuric acid is for the production of fertilizers. Other uses include the production of carbon disulphide, sulphur dioxide and phosphorous pentasulphide; pulp and paper; and rubber vulcanising. Sulphuric acid can also be used in its diluted form as battery acid for the automotive sector.
Sulphuric acid is colourless in appearance and of an oily liquid consistency. It is both corrosive and toxic and has the ability to cause serious burns. In addition, it is harmful through inhalation, ingestion and through skin contact.