The sulphuric acid market in China and Europe showcased an opposing trend during the first week of March. In China, the sulphuric acid market continued to experience bullishness driven by the high production cost, maintenance shutdowns, and high demand from the downstream agrochemical sector. However, at the same time, the European sulphuric acid market showcased a significant decline due to the sudden availability of the commodity in the market.

Key Takeaways:

• Chinese Sulphuric Acid market witnessed bullish amid the high production cost, strong demand from phosphate producers, and maintenance shutdowns.
• Europe experienced bearishness due to the unexpected availability of the sulphuric acid supply.

In China, the sulphuric acid market is maintaining the bullishness in its trend. During the week ending on March 14, the sulphuric acid market experienced a surge of 7.69%. The bullishness in the market sentiments can be attributed to the high production cost, strong demand from the phosphate producers, and the regular maintenance activities at smelters. Due to a significant surge of 12.59% of the feedstock Sulphur, the production cost of the commodity also rose.

Amid the ongoing plantation season along with the preparation for the upcoming spring application season resulting in the high demand for sulphuric acid from the fertilizer industry, some suppliers were observed delaying deliveries and pulling back their offers. Furthermore, maintenance at a few key production plants is also adding to the supply crunch. One of the production lines of Jinchuan underwent a maintenance shutdown for one month along with the maintenance shutdown at Tongling till the end of this month, further tightening the supply of sulphuric acid in China. Therefore, the combination of these factors resulted in bullish market sentiments in China.

However, the European sulphuric acid market is experiencing a sudden decline, showcasing a bearish market sentiment. The bearishness in the market sentiments was witnessed despite the consistent rise in the production cost of sulphuric acid due to the surging feedstock sulphur market. However, this rise in the production cost of the commodity did not impact the market sentiments of sulphuric acid amid the presence of ample inventory levels in the storage units. Some European suppliers were facing challenges as the major buyers, OCP were not purchasing the commodity in the European market. This has made market participants redirect their shipments towards the region where the demand for the commodity was present, particularly South America. Therefore, the European suppliers came under additional pressure to lower their ex-quotations of the sulphuric acid.

Hence, considering the current market sentiments of the commodity, the market players lowered their ex-quotations which resulted in the bearish market sentiments in Europe.

As per ChemAnalyst, the sulphuric acid market in China is anticipated to witness further incline due to the upcoming spring application season. However, the German sulphuric acid market is expected to experience a slight decline in the upcoming few weeks amid the presence of ample inventory levels of the commodity.