The Mystery Behind the Flat China Sulfuric Acid FOB Price
Since the beginning of 2026, the global sulfur supply has been tight, with prices continuing to rise, intensifying pressure across the industrial chain. The external environment has further exacerbated the situation: ongoing turmoil in the Middle East has disrupted shipping through the Strait of Hormuz, affecting nearly 40% of global sulfur maritime transport. Shipping costs have doubled, forcing a restructuring of trade flows. On the policy front, sulfuric acid, sulfur, and phosphate fertilizers are all facing stricter regulations. Meanwhile, downstream demand remains resilient—agricultural demand for phosphate fertilizers provides strong support, while competition in the new energy sector intensifies.
Against this challenging backdrop, international sulfuric acid prices have generally increased. Reports indicate that spot FOB prices in Japan and South Korea have risen to $125 per ton in 2026, up nearly 20% from $105 per ton at the beginning of the year. Spot CFR prices in Indonesia have reached $175 per ton, while CFR prices in India have climbed to $165 per ton. However, China’s smelter acid FOB index has remained stable at $125 per ton for five consecutive months since November 2025. This phenomenon of "domestic decoupling from global markets" is the result of a "firewall" built through the combined efforts of policy, industry, and enterprises.
The most direct reason lies in the tightening of export channels. Currently, the country implements a quota management system for sulfuric acid exports, with only a few enterprises granted quotas, while copper smelters—which account for the majority of production—are excluded. Customs clearance has been effectively blocked, making it impossible for most enterprises to engage in export arbitrage. As a result, "selling domestically" is far smoother than "exporting."
From the perspective of supply and demand fundamentals, China’s sulfuric acid market is highly self-contained. Data shows that from 2020 to 2025, China’s sulfuric acid exports accounted for no more than 4.1% of apparent demand, with the highest figures being 3.2% in 2021 and 3.9% in 2025. Even during peak export years, the vast majority of production was absorbed domestically. In 2025, China’s sulfuric acid production reached 110.82 million tons, with apparent demand at 106.81 million tons and exports at only 4.12 million tons. Such a vast domestic market provides a natural foundation for policy regulation—prioritizing domestic supply over exports is both a political imperative and a market reality.
Subsequently, the National Development and Reform Commission (NDRC) issued a notice on ensuring supply and price stability for spring plowing, elevating industry self-discipline to a national priority. On January 7, a production-supply coordination meeting between smelting enterprises and phosphate fertilizer companies was held, ensuring that the annual external procurement needs of phosphate fertilizer enterprises were effectively met through long-term agreements, with the scale of signed contracts reaching a record high. This means that the majority of domestic sulfuric acid production has been directly channeled to domestic phosphate fertilizer companies through policy coordination, leaving limited spot supply in the market, let alone for exports.
Under strong policy guidance, enterprises have made clear calculations: although nominal international FOB prices are high, when factoring in the cumbersome export licenses, risks associated with dual-use item controls, high shipping costs, and delivery delays, the actual returns are far less favorable than they appear on paper. Taking 2026 data as an example, spot FOB prices in Japan and South Korea stand at $125 per ton, the same as China’s FOB price. However, after accounting for export operational costs and policy uncertainties, net returns are lower than those from domestic sales. In contrast, while domestic prices face restrictions on increases, demand remains stable, payment recovery is secure, and long-term agreements provide tangible benefits. As a result, when the international market seeks to purchase Chinese smelter acid, it encounters a seller’s market with nominal prices but an actual shortage of supply.
