Asian Insoluble Sulphur Market Stabilize in November, Auto Market to Boost Demand

In the Asian market, Insoluble Sulphur prices have remained stable during November 2024, despite an increase in demand from downstream sectors, particularly the automotive industry. The market's ample supply has continued to exert downward pressure on prices, keeping them below average levels. In China, as of late November 2024, the supply of Insoluble Sulphur for tire manufacturing remains steady, with production levels largely unaffected. Semi-steel tire plants are operating at 80% of their production capacity, while all-steel tire production in Shandong has seen a decline.

The reduced demand for Insoluble Sulphur from the all-steel tire segment, combined with weaker performance across the broader tire industry, is anticipated to persist in the near term. Fluctuating costs and supply-demand dynamics within the downstream tire sector suggest that while production levels remain stable, demand growth for Insoluble Sulphur will likely remain subdued as raw material prices and overall production volumes stabilize at lower levels.

In India, Insoluble Sulphur prices stabilized in November 2024, driven by adequate supply and high Sulphur costs. Festive demand, along with increasing SUV and two-wheeler production, provided a boost to tire manufacturing, reflecting strong consumer spending and India's growing prominence in global markets. However, stable inventory levels of Insoluble Sulphur and raw material price volatility may temper further growth. The Indian PMI reflected steady manufacturing activity, with improved supplier performance and expanded production capacities. The automotive sector showed resilience, fueled by festive season demand and robust vehicle production.

In China, Insoluble Sulphur prices also remained stable in November 2024, supported by adequate supply and stable demand, particularly from the New Energy Vehicle (NEV) sector. NEV sales surged, with brands like Li Auto delivering over 50,000 units—a 27.3% year-on-year increase. Other major players, including Aito and GAC Aion, also reported significant growth. However, the broader automotive market showed signs of plateauing, with passenger car sales stabilizing at 25.1 million units in 2023.

At the same time, Insoluble Sulphur production facilities in China operated steadily, bolstered by government stimulus measures that improved supply conditions and eased inventory pressures. The temporary shutdown of some equipment tightened inventories, fostering bullish market sentiment. Despite cautious downstream activity, the NEV boom is expected to drive sustained growth. However, fluctuating upstream Sulphur prices and high shipping costs remain challenges.

According to the ChemAnalyst Database, "The prices of Insoluble Sulphur in China are likely to stay low amidst declining Feedstock Sulphur prices. Nevertheless, demand from the downstream automobile sector is expected to remain strong."