As copper, lead, and zinc concentrate TCs are facing downward pressure, the recent increase in the price of sulphuric acid has enabled smelters to increase some by-product income. According to changes in SMM sulphuric acid prices, sulphuric acid prices in many regions have increased recently. The price of sulphuric acid in Yunnan has increased by as high as 90.32%, nearly doubling. The price of sulphuric acid has also experienced many ups and downs.
The price of sulphuric acid in Yunnan Province has increased by 90.32% in more than a month.
The average (weekly) sulphuric acid price in Yunnan was 310 yuan/ton in the week of February 9, and its average price in the week of March 22 was 590 yuan/ton. In more than a month, the sulfuric acid price in Yunnan increased by 280 yuan/ton, an increase of 90.32%.
According to statistics from the China Sulphuric Acid Industry Association: According to statistics from the General Administration of Customs of China, China exported 485,000 tons of sulphuric acid from January to February 2024, an increase of 152,000 tons or 45.7% over the same period last year. The average export price was US$23.9/ton, an increase of US$3.0/ton, or 14.3%, compared with the same period last year. In February, 212,000 tons of sulphuric acid were exported, a year-on-year increase of 10.3% and a month-on-month decrease of 22.2%; the average export price was US$18.9/ton, a year-on-year decrease of 25.5% and a month-on-month decrease of 32.2%. From January to February 2024, China imported 44,000 tons of sulphuric acid, a decrease of 32,000 tons or 41.7% compared with the same period last year. After excluding high-priced acid, the average import price was US$30.6/ton, an increase of US$12.0/ton or 64.5% compared with the same period last year. In February, 15,000 tons of sulphuric acid were imported, down 15.9% year-on-year and 49.5% month-on-month. After excluding high-priced acid, the average import price was US$35.3/ton, a year-on-year increase of 30.8% and a month-on-month increase of 25.0%.
It can be seen from the quotation of SMM sulphuric acid that the price of sulphuric acid across China continued to rise in March. According to SMM research, with the start of spring plowing, the increase in demand for downstream fertilizers bolstered the price of sulphuric acid; some smelters are about to enter maintenance, and the supply of smelters will be reduced, and downstream companies stocked up in advance; a smelter in Yunnan has stopped production due to relocation, and supply in the region has become tighter, providing an impetus for rising sulphuric acid prices in the region. The price increase in the south is significantly higher than the north. According to feedback from northern smelters, the current demand in the north is not stable.
Market outlook: It is expected that sulphuric acid prices will still have room to rise in April
On the supply side: China's imported sulphuric acid dropped by 41.7% in the first two months of this year. Then with the subsequent maintenance of some smelters and the relocation of a smelter in Yunnan, the supply side is expected to decline. On the demand side: China's sulphuric acid exports increased objectively in the first two months of this year, and the "spring plowing" effort has brought increased demand. Overall, with the changes in supply and demand, China's sulphuric acid prices continued to rise in March. SMM predicts that there is still room for growth in sulphuric acid prices in April.
Li Chong, secretary-general of the China sulphuric Acid Industry Association, said at the 2023 SMM (18th) International Copper Summit- Copper Mine & Copper Smelting Sustainable Development Forum hosted by SMM that according to statistics from the China Sulphuric Acid Industry Association, as of the end of 2022, China's total sulphuric acid production capacity was 1.295 billion tons, a year-on-year increase of 1.3%; of which sulphur-made acid production capacity was 57.15 million tons, accounting for 44.1%; production capacity of sulphuric acid from smelting was 45.77 million tons, accounting for 35.3%; acid production capacity using pyrite was 23.22 million tons, accounting for 17.9%. With the advancement of projects such as non-ferrous metal smelting, new energy, new materials, and comprehensive utilization of sulphur-containing waste, there will still be nearly 30 million tons of new and planned projects from 2023 to 2025. Among them, sulphuric acid from non-ferrous smelting, accounts for half. The total national sulphuric acid production in 2022 was 107 million tons, a year-on-year decrease of 2.2%. The output of sulphuric acid from sulphur was 44.22 million tons, a year-on-year decrease of 8.0%. The output of sulphuric acid production from pyrite was 17.65 million tons, a year-on-year decrease of 4.6%; accounting for 16.5%. The output of sulphuric acid made from other raw materials was 2.55 million tons, a year-on-year increase of 42.3%. As "carbon peaking and carbon neutrality" targets reduces fossil energy consumption, sulphur production declines, making supply tight. As batteries and energy storage become saturated and the proportion of metal recycling increases, the demand for sulphuric acid slows down. The recycling of metals such as copper, lead, and zinc has increased, reducing the amount of ore used, and the by-product sulphuric acid production has decreased. Overall, market supply and demand will be more balanced in the future. Global demand for sulphuric acid will grow steadily from 2021 to 2025, with a compound growth rate expected to reach 3.7%. By 2035, global sulphuric acid demand will grow at a compound annual growth rate of 2%.
For more information on sulphuric acid, smelter prices and fundamentals, please attend the 2024 SMM (19th) Copper Industry Conference and Copper Industry Expo.
