The global sulphur markets are covered weekly by ICIS in The Market. The Market gives you the global view on the fertilizer market, and is tailored for the international fertilizers business. The commentary includes supply and demand trends, production news, shipping enquiries, fertilizer prices and price drivers and fluctuations.
Commodities covered in The Market include:
Updated to Q2 2020
Qatar Chemical and Petrochemical Marketing and Distribution Co (Muntajat) issued its first spot tender in nine months, offering 35,000 tonnes in June. Indian sulphur became more available in Asia, as producers turned to the export market after measures to stop the spread of the coronavirus limited domestic demand. Chinese port stocks started to build up towards the end of Q2, climbing to nearly 3m tonnes.
Demand was restored in China after lockdown measures were relaxed and end-use phosphate plants resumed production. However, demand from India dropped significantly, as lockdown measures halted production at some phosphate plants.
Liquid sulphur supply was tight in Q2, amid reduced output from refineries due to the impact of the coronavirus. Ongoing factors, such as a move to sweeter crude, plant turnarounds and the continued depletion of output from German natural gas fields also continued to impact supply. Product from the CIS region re-entered the market, following the reopening of Black Sea ports in April.
Demand was stable following Q2 contract settlements in January. However, cutbacks in capro production during the rest of the quarter limited demand for sulphur and sulphuric acid.
Canadian sulphur supply at ports improved from Q1, but there was still some tightness throughout Q2. Production was strong in western Canada, with the exception of Syncrude, running at around 50%. In the US, refinery run rates dropping to record lows amid the coronavirus led to supplies decreasing. This led to sharply lower tonnes able to be sent offshore from the US Gulf. By end-Q2, supplies had increased slightly, albeit still at low levels.
Demand for Canadian tonnes shifted during Q2. China required less tonnes than usual, but other regions filled in the gaps, such as Brazil, Mexico and Australia. There was some demand from Morocco, which is not a typical trade flow seen. In the US, the market remained very quiet as low inventories kept export cargoes from being feasible. Demand from Brazil for US tonnes was sharply higher.
Updated to Q3 2020
Supply is expected to remain constant in Asia, as there are no known plans for output cuts in the region.
Demand in Asia will be highly influenced by India’s appetite for DAP fertilizers. The $18/tonne increase in phosphoric acid settlements means it is cheaper to import DAP rather than produce it domestically. Thus, participants expect that this increase will lead to more DAP imports in Q3, particularly from China, which will mean more demand for sulphur from China.
Refinery output levels are expected to increase if coronavirus prevention measures continue to be relaxed and fuel demand picks up. Supply will also increase as refineries come out of maintenance.
Demand in Europe will again be dependent on sulphuric acid and capro market conditions. The impact of the coronavirus on downstream demand will be the deciding factor.
US supply is expected to remain depleted as refiners will likely continue running at low rates amid the coronavirus. In Canada, Syncrude is expected to keep its production at about 50% throughout Q3. Some inventories may become bottlenecked in the Vancouver port terminals as Pacific Coast Terminals conduct multi-week maintenance in August.
Signals are mixed regarding Q3 demand. Some sentiment has pointed to lower demand for US tonnes from Brazil. Additionally, record-high China inventories will likely keep the country sidelined, which will lead to softer demand for Canadian tonnes.
We offer the following global phosphates analysis and news coverage to keep you informed of factors and developments affecting prices in the Sulphur marketplace.
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Sulphur (S) is an important element in nature. As a constituent of proteins, has a similar nutrient value to nitrogen (N) and is essential to the life of plants, with its lack causing similar effects to the lack of nitrogen.
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.
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