Sulfur Market in Brief
With the previous week's Labour Day holidays, in many regions market activity is yet to ramp-up. However, it is not just the holidays that are holding trading activity at bay. Buyers are also taking a pause to wait for clear market direction and some traders are comfortably forward sold - in to June in some cases - allowing them to also wait on the sidelines.
Currently, the lower than expected Middle East monthly lifting prices for May in the range of USD 102-105/MT FOB, and the ongoing weak phosphate market sentiment, is still pointing towards flat-to-soft pricing. But the market is waiting for Brazil and India's end-users to return for some clarity on the next direction sulphur spot market prices are going to take, for now.
Active Forces in the Market
Market Outlook in Next Month
With the market waiting on clear direction, expectations for the next 30-60 days are mixed. Some sell-side parties’ pin hopes on prices improving in the third quarter, whilst some buy-side parties expect flat pricing.
Asia
China
Market activity is yet to restart in earnest following the Labour Day break. In most cases, buyers are taking a pause this week, preferring to wait for clearer market direction. Sentiment has turned bearish because of a number of factors, including lower-than-expected Mideast posted prices for May and ongoing weak sentiment in the downstream phosphates sector, which is seeing weekly DAP price declines.
The threat of further US tariffs on Chinese goods has also impacted wider economic sentiment, denting confidence and impacting currency markets this week. There are minimal firm CFR offers tabled, just seller indications ranging USD 125-126/MT CFR Yangtze river for Mideast tons, against bids nearer low-USD 120s/MT CFR at a maximum.
The sale of 50,000-55,000t of granular sulphur at USD 118/MT CFR, for June arrival in the south is widely reported but not confirmed directly. Also, a cargo of Canadian origin 50,000t in size is understood to have been sold to a buyer in the river last week in the low-USD 120s/MT CFR for June arrival. Iranian cargoes are being considered into the south this week, but no trades have been confirmed as completed.
The crushed lumps market has remained muted, prices are still placed at a maximum of USD 110/MT CFR by participants. Molten prices are also still understood to be holding a bottom end in the high-USD 90s/MT CFR, but no new business has been confirmed this week.
The China CFR price is held flat at USD 98-121/MT.
Domestic market
For Puguang produced sulphur, Sinopec has kept Wanzhou steady at Yn990/MT and Dazhou has been increased by Yn10/MT to Yn870/MT. At port, prices were still sitting in the Yn990-Yn1,000/MT
range with very little business heard in the market at the start of the week. But, as the week progressed prices softened with concluded business falling in the range of Yn970- Yn990/MT.
This would reflect nearer the low-USD 120s/MT CFR bulk after this week's currency shifts. Paper prices also fell steadily, down to around Yn960/MT for June and Yn970/MT for July. Port stocks had slipped again earlier this week, according to official figures, to 1.17mn t. But closer to press time they
were understood to have risen to 1.35-1.37mn MT and there are indications that around 500,000 MT of sulphur is scheduled to arrive at river ports alone across May.
India
The Indian import market could see some action shortly with fertilizer producer Paradeep Phosphate (PPL) shortly expected to issue a purchase tender. Fertilizer producer IFFCO will receive a contract cargo in mid-June from a trader. The company's Paradeep plant is currently under maintenance so no sulphur is required before then. CIL also does not require any spot product at present.
On the supply side, the MV Rattana Naree is currently being loaded at New Mangalore port by trader Swiss Singapore, to ship around 15,750t to China. This shipment is linked to the last spot sales tender from domestic refiner and sulphur producer MRPL.
Middle East
No new spot business has been confirmed this week but May Official Selling Prices (OSPs) have been confirmed within the range USD 102-105/MT FOB, flat on April OSP levels.
Iran
Activity has been slim in the Iranian market and no new spot sales have been confirmed. But a freight inquiry has emerged for 30,000-40,000t of bulk granular loading Bandar
Imam Khomeini 25 May-10 June, for shipment to South China. The inquiry is thought to be linked to Turkish trading-house Raintrade Petrocheimcals which supplies Iranian sulphur. There is also an inquiry for 27,000-42,000t loading Bandar Abbas 5-15 May for shipment to Fangcheng, China.
Qatar
Qatari state-owned marketer Muntajat has issued its monthly sales tender, offering 35,000t of granular sulphur loading in June at Ras Laffan port.
UAE
Abu Dhabi state-owned sulphur producer Adnoc has set its May Official Selling Price (OSP) at USD 105/MT FOB Ruwais, flat from April. In the freight market there is an inquiry for 40,000t loading Ruwais 24-28 May for shipment to Nantong/Zhenjiang range, China.
Africa
Spot business for cargoes over 10,000t in size remains thin this week with key buyers out of the market and those seeking tons still pursuing prices they consider attractive. This keeps north Africa CFR prices steady at USD 95-110/MT.
Egypt
Confirmed business is lacking but buyer price bids are now widely reported in the low-to-high-USD 90s/MT CFR range for granular tons. Bids for crushed tons are ranging USD 10/MT below this.
Morocco
Around 282,000t is currently scheduled for discharge at Jorf Lasfar port.
South Africa
The MV SSI Magestic is scheduled to arrive at Richards Bay on 23 May. The vessel has a deadweight of 55,694 and loaded at Ruwais, UAE.
Freight Market Overview
Fertilizer freight rates remained under pressure this week despite previous forecasts signaling that the market would start to bounce back as the surplus of available ships continued. One market participant outlined May as a more buoyant month for freight rates, but the current supply/ demand balance is closer to the typical seasonal lows of January and February and rates do not appear poised to move higher.
Fixing activity was also dampened by public holidays across Asia last week as many ship owners and vessel charterers stepped out of the market, which contributed to the weaker overall sentiment among owners. Ultramax ships from the east coast of South America to east Asia were booked lower, at USD 13,000/d, with a ballast bonus of USD 300,000. A flood of tonnage in the US Gulf meant that transatlantic journeys to northern Europe were under discussion at USD 11,000/d or lower, while South America to east Mediterranean transatlantic journeys were priced slightly higher at USD 13,000/d.
Report By: Shahriyar Yusefi
