After exhibiting constant fluctuations in the first and the second quarters of 2021, phosphorous trichloride prices surged drastically in the third quarter and entered the fourth with no deviation from the trend. According to the ChemAnalyst database, the price for phosphorous trichloride showed 6% growth in the first week of July from the price in the first week of June, further gaining 12% in the first week of September. On October 1, a whopping 62% hike in the prices was registered, which amounted to USD 2185 per metric tonne of phosphorous trichloride.

Phosphorous trichloride is a pungent-smelling colourless inorganic liquid that gives off pale yellow smoke. It is marked as a highly toxic compound that undergoes a violent chemical reaction with water to produce hydrochloric acid. Phosphorous trichloride is an important industrial chemical that is widely used for the manufacture of phosphorous oxychloride (an important agrochemical intermediate), flame retardant chemicals, plasticizers and oil additives. India produces adequate volumes of phosphorous trichloride to satisfy the domestic demand and cater to international exports. The key market players in India are Sandhya Group, UPL and Excel Industries Ltd.

The prices of phosphorous trichloride in the first two quarters of the running year had remained subdued following limited offtakes by the downstream sector, and disruption of the supply-demand network due to the resurgence of COVID19 pandemic accompanied by the temporary closure of UPL plant at Jhagadia following an outbreak of fire. Nevertheless, the third quarter witnessed a firm downstream demand for phosphorous trichloride amid limited production due to still recovering plant damages and production efficiencies, that propelled the rise in prices. A further kick in the price of phosphorous trichloride, during September, was observed on the back of extremely low supply of yellow phosphorous feedstock in the country, which was influenced by the limited imports from China, a leading producer in Asia, that has cut down its productions to sustain heavy power outages. Further worsening the condition, Excel Industries Ltd. has stopped production and supply of phosphorous trichloride in the wake of its ongoing expansion project at Raigad, Maharashtra, thereby increasing supply pressure on the existing inventories.

As per ChemAnalyst, the demand for phosphorous trichloride is expected to remain steady over the next quarter, considering the outlook for the next crop season. Hence, the prices of phosphorous trichloride in India are anticipated to surge further due to few plant operations and lingering supply crunch of yellow phosphorous from China where the government regulations towards limited utilization of power do not seem to ease out soon.