The upward trend in smelting acid prices has persisted for over half a year, with further room for growth expected in the fourth quarter. [SMM Analysis]

Published: Sep 4, 2025 16:44

Source: SMM

Save

[SMM Analysis:The upward trend in smelting acid prices has persisted for over half a year, with further room for growth expected in the fourth quarter.] Will the upward trend continue into the fourth quarter? The answer is yes. On the supply side, ten smelters are scheduled for maintenance in the fourth quarter, affecting 2.7 million tons of crude smelting capacity, which will significantly limit smelting acid supply. Additionally, recent shutdowns of small acid plants in southwestern China have tightened acid sources.On the demand side, winter fertilizer preparation needs will gradually emerge in the fourth quarter, stimulating demand for smelting acid. Moreover, recent renewed increases in sulfur prices have bolstered demand for smelting acid as a substitute for sulfur-based acid. Finally, at the end of August, the EU revoked the carcinogenic label for titanium dioxide, which is expected to benefit China's titanium dioxide export demand.

》View SMM Copper Prices, Data, and Market Analysis

》Subscribe to View SMM Historical Spot Metal Prices

The Chinese market for 98% smelting acid has experienced a significant price increase this year, providing copper smelters with some relief amid continuously declining spot treatment charges for copper concentrate.

Reflecting on this year's smelting acid market, supply-side constraints have been a major factor. Many smelters reported insufficient acid storage capacity. In addition to recovering demand, another reason is the reduction in copper concentrate input by Chinese smelters. Without desulfurization and capture of sulfur elements from copper concentrate for flue gas acid production, the accumulation of smelting acid inventory has been limited.

On the demand side, the National Development and Reform Commission eased restrictions on fertilizer exports through window guidance early this year, boosting demand for acid in fertilizer production and driving up smelting acid prices.

Furthermore, with the rise of industrial and new energy sectors in Southeast Asia, demand for sulfur-based acid in the region has surged, leading to a sustained increase in sulfur prices this year. Additionally, an explosion at the Shahid Rajaee Port in southern Iran in May caused another spike in sulfur prices. The rising cost of sulfur has been a significant driver of increased demand for smelting acid. This is also reflected in China's sulfuric acid export data: from January to July, China exported 2.62 million tons of sulfuric acid, a cumulative year-on-year increase of 103%. Chile accounted for 42% of these exports, followed by Morocco (16%), India (11%), Saudi Arabia (11%), and Indonesia (10%).

Lastly, the growth of China's domestic new energy industry has increased demand for acid in intermediate processes of the sector.

Will the upward trend continue into the fourth quarter? The answer is yes. On the supply side, ten smelters are scheduled for maintenance in the fourth quarter, affecting 2.7 million tons of crude smelting capacity, which will significantly limit smelting acid supply. Additionally, recent shutdowns of small acid plants in southwestern China have tightened acid sources.

On the demand side, winter fertilizer preparation needs will gradually emerge in the fourth quarter, stimulating demand for smelting acid. Moreover, recent renewed increases in sulfur prices have bolstered demand for smelting acid as a substitute for sulfur-based acid. Finally, at the end of August, the EU revoked the carcinogenic label for titanium dioxide, which is expected to benefit China's titanium dioxide export demand.

Cathode materials Market review

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM‘s internal database model. They are for reference only and do not constitute decision-making recommendations.

For any inquiries or to learn more information, please contact: lemonzhao@smm.cn

For more information on how to access our research reports, please contact:service.en@smm.cn

Related News

1 hour ago

Shanghai Copper Spot Prices to Remain Under Pressure Amid High Inventories and Soft Demand

Shanghai copper spot to stay under pressure tomorrow. Recent arrivals of imported copper—including Japanese brands like SRP and TAMANO-P—are weighing on spot discounts. Demand softened as end-users showed limited acceptance of higher prices. Some holiday restocking emerged, but high spot inventories cap any upside. The narrow spread between high-grade and standard-grade copper reflects subdued actual consumption. The spot discount against the 2604 contract is expected to persist.

1 hour ago

Early-Month Purchasing and Stockpiling Failed to Offset the Impact of Imports, SHFE Copper Spot Premiums Remained Under Pressure [SMM Shanghai Spot Copper]

[SMM Shanghai Spot Copper] Looking ahead to tomorrow, the Shanghai spot copper market is expected to see a phased recovery. Demand side, as a new monthly procurement cycle begins, the previously pent-up purchasing demand of downstream enterprises will be gradually released. Coupled with the stockpiling window ahead of the Qingming Festival, market inquiry activity is expected to rebound, and trading conditions may improve significantly from month-end levels, providing some support for spot discounts. From the market structure perspective, the price spread between high-quality copper and standard-quality copper has remained at a relatively narrow level, reflecting that actual consumption demand still dominates the market, while brand premiums have weakened. Supply side, imported cargoes have continued to arrive recently, and the destocking speed of social inventory in Shanghai has slowed, leaving overall circulating supply relatively ample and limiting the room for discount recovery. Overall, driven by early-month procurement and pre-holiday stockpiling, spot prices against the SHFE copper 2604 contract are expected to see some narrowing in discounts tomorrow.

1 hour ago

Market Activity Increased After the Contract Rollover, Spot Premiums Continued to Rise [SMM South China Spot Copper]

1 hour ago