Demand from metals sector bolsters sulphur pricing

Market: Fertilizers, Metals
19/10/23

Demand from the metals sector has supported upward price moves for sulphur, for sellers in the Middle East and the Baltics and buyers in southern Africa and southeast Asia, while fertilizer demand is starting to plateau.

A flurry of bookings for sulphur vessel loadings for Indonesia supported upward price moves last week, as demand for sulphur used in the nickel-leeching process firmed. The southeast Asia cfr sulphur price rose to $135.50/t cfr, an increase of 59pc from mid-July, and became the strongest cfr sulphur price globally at present. Nine cargoes were booked for loading from the Middle East and Canada to nickel producers Huayue and Lygend in Indonesia.

Higher price points drew more sulphur vessels eastwards. Molten sulphur vessel the Iver Ability loaded from the Middle East and is headed for Indonesia this month. This is the first time that this vessel has headed eastwards since May, vessel-tracking data show.

Demand for sulphur from copper mines in the Democratic Republic of the Congo has also offered support to delivered pricing. The southern African cfr sulphur price climbed to $131.50/t cfr in October, from $85/t cfr in July. China's CMOC earlier this year issued a large annual tender for about 200,000t for its copper-producing Tenke Fungurume mine. This has led to a spate of bookings for sulphur vessels discharging in Dar Es Salaam. The Samsun, PPS Luck, Nord Dubai and Aramis loaded from the UAE in September, carrying a combined total of 212,000t of sulphur.

Sulphur price increases also have been supported by MAP and DAP pricing that has firmed since August. But demand from the fertilizer sector is starting to cool off. Sulphur stocks in China — a major sulphur buyer and fertilizer producer — reached 2.75mn t this week, similar to volumes during the Covid-19 pandemic when all product was being stored on a lack of demand. Liquidity has started to stifle now that Indonesian and African sulphur demand for the metals sector is covered and DAP and MAP demand is starting to drop again.

Recent sulphur trades to metals buyers that have concluded at higher prices may have set the ceiling for the market in the final quarter of this year.

By Bea O'Kelly

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