For the week ended July 31, China’s sulphuric acid market continued to drift lower, with the price center moving further down and regional declines widening WoW. The SMM China Copper Smelting Acid Index stood at 1,722.5 yuan/mt, down 19.5 yuan/mt WoW, the fourth consecutive week of decline.
This week’s price drop was mainly driven by weak demand. Supply side, the resumption of previously maintained units brought incremental supply release, and the news that Hongsheng Copper will resume production on August 10 further intensified expectations of supply surplus. Demand side, phosphate fertilisers entered the seasonal demand off-season, leading to cautious downstream procurement; operating rates at titanium dioxide and fluorine chemical producers continued to decline, weighing on their purchasing ability. Cheap cargoes flowing across regions continued to depress prices in surrounding markets. Cost side, SMM sulphur (EXW Shandong) was quoted at 8,957-9,250 yuan/mt on Friday, averaging 9,103.5 yuan/mt, down 350 yuan/mt WoW. Although sulphur prices remained high and firm, weakening demand dominated this week’s price trend.
Regionally, prices fell in most areas, with Fujian the only region to post a gain. Shandong saw the largest drop, with its EXW price down 140 yuan/mt to 1,600-1,750 yuan/mt. The influx of cheaper cargoes, combined with weak local demand, pushed the actual transaction center down to around 1,600 yuan/mt. Yunnan fell 120 yuan/mt to 1,440-1,510 yuan/mt, with prices continuing to decline. Qinghai dropped 100 yuan/mt to 1,720-1,740 yuan/mt, mainly influenced by bearish sentiment from outside markets. Shanxi down 50 yuan/mt to 1,650-1,750 yuan/mt; Sichuan down 40 yuan/mt to 1,500-1,720 yuan/mt. Henan edged down 15 yuan/mt to 1,650-1,750 yuan/mt. Hubei prices held steady for now, but may face further pressure after Hongsheng Copper resumes production on August 10. Hanzhong Zinc Industry in Shaanxi kept offers steady, though some low-quality 94% acid was lowered by 30 yuan/mt.
Fujian EXW price rose 20 yuan/mt to 1,580-1,700 yuan/mt, making it the only region to rise this week. Fujian Zijin raised by 40 yuan/mt to 1,580 yuan/mt, and Dongnan Copper raised by 30 yuan/mt. Companies reported this was a technical rebound after an oversold drop, with downstream demand not showing clear improvement, so sustainability remains to be seen. Guangxi held steady at 1,780-1,900 yuan/mt. Railway transport of sulphuric acid from Guizhou is expected to start in August, which could further optimise logistics channels. Anhui, Jiangxi, and Hunan prices were stable, with relatively balanced supply and demand. In north-east China, prices held steady, but in Chifeng, with some smelters undergoing maintenance and supply tightening, August new prices may edge up. In north-west China, Gansu and Xinjiang were steady, while Liangshan Mining lowered by 80 yuan/mt to 1,500 yuan/mt, with the company citing weak demand.
International market, SMM sulphuric acid (CFR Indonesia) quoted at $320-350/mt, average price $335/mt, down $5/mt WoW; SMM sulphuric acid (FOB South Korea) at $340-350/mt, average $345/mt, flat WoW. SMM sulphur (CIF Indonesia) quoted at $1,100-1,200/mt, average price $1,150/mt, flat WoW. In the African copper belt, SMM sulphur (DAP DRC) at $1,800-1,950/mt and (DDP DRC) at $2,050-2,450/mt, average prices up $50/mt WoW.
Looking ahead, China's sulphuric acid price is expected to remain in the doldrums in the short term. Off-season demand coupled with supply growth releases, prices still face downward pressure, but high sulphur costs will limit the extent of declines. Regional divergence may persist: the sustainability of Fujian's slight rebound is questionable, Shandong, Yunnan, and other regions that adjusted earlier may gradually stabilize, and Hubei's price may face further pressure after Hongsheng Copper resumes production. Internationally, the evolving situation in the Red Sea and the shipping pace through the Strait of Hormuz remain key variables. Focus on the actual impact of Guizhou's railway transport opening on the diversion of Guangxi's supply sources, and the pace of autumn fertilizer preparation.
Key data summary for the week:
- SMM China Copper Smelting Acid Index: 1,722.5 yuan/mt, down 19.5 yuan/mt WoW
- SMM Sulphur (EXW Shandong) Average Price: 9,128.5 yuan/mt (July 30)
- Shandong Sulphuric Acid: 1,600-1,750 yuan/mt (-140)
- Yunnan Sulphuric Acid: 1,440-1,510 yuan/mt (-120)
- Qinghai Sulphuric Acid: 1,720-1,740 yuan/mt (-100)
- Fujian Sulphuric Acid: 1,580-1,700 yuan/mt (+20)
