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| Sulphuric Acid on the WebTM | Technical Manual | DKL Engineering, Inc. |
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Knowledge for the
Sulphuric Acid Industry Introduction |
Oversupply of sulphur a challenge for producers MEED, Issue No. 27 2 – 8 July 8, 2010 - The oversupply
of sulphur is a key concern for the region as it looks to exploit more sour oil and gas
fields June 17, 2010 - New Delhi, India - The Centre's decision to decontrol prices of all non-urea fertilisers simultaneous with the grant of a fixed nutrient-based subsidy (NBS) on individual products seems to paying off. The significant decline in global prices of most fertilisers and their intermediates in recent months has meant the Centre is under no compulsion now to raise subsidy payable to companies. And the latter have no apparent grounds to hike maximum retail prices (MRP) charged to farmers even in a decontrolled environment. In other words, contrary to earlier fears of decontrol leading to substantially higher farmgate prices or an expanded subsidy bill for the Centre, a bearish international market has ensured there is no pressure on either front at least for now. Raw materials - Currently, urea of West Asia origin is quoting at $235 a tonne free-on-board (f.o.b.), as against $315-320 just three months ago. Inclusive of freight of around $12, the landed price at Indian ports would be hardly $247 a tonne. Likewise, prices of ammonia and sulphur – both used for manufacture of di-ammonium phosphate (DAP) – have eased considerably. Since mid-March, ammonia has dropped from $380 to $300 a tonne (f.o.b. West Asia), with landed prices here now at around $330 a tonne. Sulphur prices, which had touched $200 a tonne (cost & freight India) in March, have since slid to $120 or thereabouts. Fixing subsidy - The Centre had, on March 16, fixed the per kg NBS rates at Rs 23.227 for nitrogen (N), Rs 26.276 for phosphorous (P), Rs 24.487 for potash (K) and Rs 1.784 for sulphur (S). These rates formed the basis for fixing the subsidy on individual fertilisers. For example, one tonne of DAP contains 180 kg of N and 460 kg of P. The subsidy payable to its manufacturers/importers, then, came to Rs 16,268 a tonne, while working out to Rs 10,133 for a tonne of ‘20:20:0:13' NPKS complex fertiliser. For arriving at the per kg NBS rates, the Centre had benchmarked them to import parity prices (IPP) of urea (for N), DAP (for P), muriate of potash (for K) and sulphur (for S), which were taken at $310, $500, $370 and $190 a tonne at Rs 46-to-the-dollar. MRP hike unlikely - But with current landed prices – at $247-248 for urea, $470-475 for DAP and $120 for sulphur – actually ruling below the assumed IPPs, the Centre has two options. The first one would be to reset the unit NBS rates to reflect the lower import prices and, thereby, reduce the subsidy payable to manufacturers/ importers. The second option would be to force companies to slash farmgate prices, though this is theoretically inconsistent with a decontrolled regime. “They are unlike to do either immediately. What is more likely is that the industry would be informally directed not to raise MRPs in the coming rabi season, just as they were asked to cooperate and keep price increases within limits for this kharif,” sources pointed out. In fact, for the ongoing kharif season, companies had given undertaking that they would not raise the MRP of any non-urea fertiliser beyond Rs 30-35 a bag. Accordingly, DAP is now selling at a uniform Rs 9,950 a tonne (excluding local taxes), against Rs 9,350 prior to April 1, when prices were ‘decontrolled'. Moreover, companies have been made to clearly print the MRP along with the applicable subsidy on every bag of fertiliser they sell, with any sale above the printed rate punishable under the Essential Commodities Act. “The Centre's sole concern is that decontrol should not have any adverse political fallout. The decline in global prices is welcome to that extent,” the sources added. Copper concentrate market in
deficit for 3 years - Freeport June 12, 2010 - Bloomberg cited Mr Javier Targhetta senior
VP of marketing and sales of Freeport McMoRan Copper & Gold Inc’s as saying that
the copper concentrate market will have a shortfall for 3 years after miners delayed
projects because of lower prices. Mr Targhetta said that the deficit will be between
500,000 tonnes and 1 million tonnes this year. He said that the concentrate market will
remain tight over the next 3 years or even longer. Concentrate is the raw material from
which copper is produced. Barclays Capital said that mining companies delayed or
scrapped new projects after copper prices plunged a record 54% in London in 2008, crimping
future supply. Global mine production fell 0.1% last year. The refined market is expected
to show a deficit of 155,000 tonnes this year after a surplus of 567,000 tonnes in 2009.
Mr Targhetta said at the event, organized by the GDMB Society for Mining,
Metallurgy, Resource and Environmental Technology with Hamburg based Aurubis AG that the
shortfall in mined output will keep the fees that mining companies pay smelters to turn
ore into metal under pressure for a long time. He said that smelters have received
increased supplies of scrap copper and have benefited from higher prices for sulfuric
acid, the largest by product from the smelting process. Mr Targhetta said that scrap
is helping smelters in China and also outside China. This year Atlantic Copper’s
plant in Huelva, Spain, will produce 20,000 tonnes of copper from scrap up from 7,000
tonnes last year. He said that Atlantic Copper, based in Madrid, produces about 1
million tonnes of sulfuric acid per year. This year the company expects to produce 278,000
tonnes of copper anodes usually refined into a finished form of metal known as cathode.
That’s 8,000 tonnes more than last year. Production of cathodes will reach 262,000
tonnes this year up from 257,000 tonnes. He added that production will be lower next year
as the plant is scheduled to be closed for about 20 days for maintenance work. April 18, 2010 - Prices of sulphuric acid, a copper smelting by-product, have risen by half in China over the month, keeping operating rates high despite low copper treatment and refining charges (TC/RCs). Sulphuric acid prices have risen to touch 600 yuan ($89) per tonne, from an average of 400 yuan a month ago, delegates at the 2010 Beijing copper summit held by China Nonferrous Metals Industry Assn (CNIA) told MB. "Average prices could be around 500-600 yuan per tonne, thanks to rising demand for fertilizer". Sulphuric acid prices held down by excess
supply April 7, 2010 - Purchasing of sulphuric acid has undergone a "dramatic turnaround" so far this year, according to CRU International, which says "rising demand is evident from the industrial sector, the phosphate fertilizer industry and copper leaching operations." However, inventories still are well in excess of renewed demand. So, near-term prices should stay around the $144/ton average of the first quarter and not approach the $200/ton average of 2009, according to the CRU report presented at this week's World Copper Conference in Santiago, Chile. While there is some tightness in the U.S. acid market, ICISpricing.com says production rates were slightly improved from a month ago. So, there is quite some debate whether spot prices will rise in the second quarter back to $150-$200, as sought by producers. Another issue is that phosphate fertilizer prices have begun to weaken, "undermining sentiment in the sulphuric acid market," says CRU. "It is too early to say whether the price boom-that brought U.S. market prices up from an average $107/ton in October and November-has come to an end, but market activity is very thin and there are growing indications that further increases may not be sustainable." The analysis suggests that supply of sulphuric acid is forecast to remain tight. So, drop in prices is unlikely for the next few months. However, the peak application season for phosphate fertilizers is almost over, and stocks of sulphuric acid are expected to gradually increase over the summer. "For this reason, the second half of the year will probably see prices coming down for both products," CRU forecasts. In another analysis of the world fertilizer market, TD Bank analysts also are cautious about offshore demand due to recent weakness in global crop prices, "which may limit the global demand fertilizer rebound volume and/or price gains." Source www.purchasing.com Sulfuric Acid Goes From Worthless to
‘Crazy,’ Boosts Mine Costs March 8, 2010 - The value of sulfuric
acid, used to dissolve metal ore and produce fertilizer, has gone from worthless to
“crazy” this year, increasing costs for mining companies, London-based
researcher CRU Group said. “It all changed very quickly,” Joanne Peacock,
an analyst at CRU, said in an interview in London today. “Fertilizer demand was
suddenly much stronger than expected.” Rebounding market rates for the acid, a
byproduct of copper processing, to more than $100 a metric ton may help smelters of the
metal to boost output as they can profit from the sale of the residue. Stockholm-based
Boliden AB was among operators that previously cited the slump in prices as part of the
reason for curbing output. Miners, though, face rising costs, Peacock said. Demand
from fertilizer makers, normally about half of world sulfuric acid consumption, has risen
as higher prices for their products prompted companies to rebuild stocks, Peacock said.
“It’s all gone crazy,” she wrote in a separate e-mail today. Supply
from metal smelters, oil refineries and burning elemental sulfur couldn’t keep up,
she said. “The availability of sulfur has been much lower than expected,”
Peacock said. “The refineries haven’t been able to increase their operating
rates to full capacity yet because the U.S. consumer is not buying as much diesel and
gas.” U.S. oil refineries operated at 81.9 percent capacity in the week ended
Feb. 26, according to the latest data from the U.S. Energy Department released March 3.
This time last year it was 83.14 percent and in 2008 output was 85.19 percent. Surging market prices for acid will probably be temporary
as demand dies down, Peacock said. “I still see the underlying demand picture as
fundamentally weak and this situation may not last beyond the first half of this
year,” she said. Fertilizer demand fell to its weakest in five years in 2009 as
economic crisis and the credit crunch hurt farmers, according to CRU. Annual contract
prices for this year fell to about $30- $60 a ton, from $110-$140 in 2009, Peacock said in
December. Sulfuric acid demand, typically about 200 million tons a year, will
probably increase from 2009, though is unlikely to reach levels before the economic crisis
in 2008, she said. China fertilizer Market March 2010 - In 2009,
under the "positive fiscal, easy monetary" policy, the government has
implemented a large-scale economic stimulus plan, substantially lower interest rates, take
various measures to boost domestic demand and encourage exports. The slowing down momentum
of China's macroeconomic growth has been effectively contained, and resumed an increase of
over 8% compared the same period last year in the second of 2009. As for external
economies, the global economic recession caused by the international financial crisis also
has a certain degree of recovery, the negative impact on China's economy began to be
weakened. China's
sulfuric acid price to hit new high after Chinese New Year January 21, 2010 - The factory
price of concentrated sulfuric acid in China is expected to reach a new high after the
Chinese New Year after increasing to RMB 450 per ton recently from RMB 150 per ton in
October 2009, sources reported. The price
surge mainly resulted from the rising cost and growing demand, said industry analysts,
adding that the demand may grow significantly after the Spring Festival when the farmers
started plant crops. Reportedly, 75% to 80%
of sulfuric acid is used in the production of fertilizers in China. Statistics show that China's phosphate fertilizer
capacity is 20 million tons at present. Higher Sulfuric Acid Prices To
Help Chinese Copper Smelters January 20, 2010 -
Chinese copper smelters may be able to offset some of the revenue losses from lower
treatment and refining charges settled with global miners this year thanks to higher
sulfuric acid prices in domestic markets. Smelters have reached 2010 copper
treatment and refining charges, or TC/RCs, with BHP Billiton Ltd. and U.S.-based Freeport
McMoRan Copper & Gold Inc. at $46.50 a metric ton and 4.65 cents a pound, 38% lower
than last year, a consequence of too much capacity being brought online and an
overreliance on imported concentrate supply. The settled TC/RCs will make it hard
for the struggling smelters to generate revenues, given average production costs for
copper refining of around $70/ton and 7 cents a pound. "No doubt smelters
won't make any money out of this year's refining fees, but normally they have other ways
to make up for it, such as sulfuric acid sales, increasing self-sufficiency in concentrate
supply," said Che Hongyun, a senior metals analyst with Galaxy Securities Futures.
Sulfuric acid is a byproduct of copper cathode--refining a ton of cathode yields
three tons of sulfuric acid. Since the start of the year, the sulfuric acid price
has doubled from the average in 2009 to CNY400 a metric ton, high enough for copper
smelters to squeeze some profits from their refining activities, industry participants
said. "The current sulfuric acid price certainly benefits copper smelters
because demand from fertilizer makers keeps it on a strong note these days," said
Qiao Bo, an analyst with Beijing Antaike, the state-owned metals consultancy.
However, it is hard to store sulfuric acid and the logistics costs are relatively high, so
sales may still bring in only a thin stream of revenue. Given still-sluggish demand
for fertilizer in overseas markets, "I don't see sulfuric acid prices going as high
as the historic level of around CNY1,800/ton in 2008...but the firmer price will
definitely help copper smelters make some money," said Antaike's Qiao. A
senior official from Tongling Nonferrous Metals Group (000630.SZ) said that the company
doesn't count on sulfuric acid sales: "We just need to make sure that our sulfuric
acid has places to go." "I think ultimately copper smelters may rely
on higher copper prices to secure profits," said He Xiaohui, a copper analyst with
Beijing Antaike. The Future of Global Sulfuric Acid to Depend on
World Fertilizer Sector According to the Latest Research by Merchant Research &
Consulting, Ltd. December
21, 2009 - LONDON – Demand for sulfuric
acid is mainly determined by the world fertilizer
sector. The latter has experienced the influence of deteriorating global economy
situation resulting in markets going down in the second half of 2008 - the beginning of
2009. Sulfuric acid: 2009 World Market Outlook and Forecast
Updated: 11/2009/ 288 Pages China Sulfur Industry Report, 2009 December
17, 2009 - ResearchInChina, the vertical portal for Chinese business
intelligence, announces the release of a new report - China Sulfur Industry Report, 2009.
For more information, please contact us at report@researchinchina.com or at
86-10-82600893. For details of this report please visit http://www.researchinchina.com/Htmls/Report/2009/5795.html. Sulfuric acid demand and prices set to escalate as economy revives - Spot prices of sulfuric acid have been on a roller coaster ride, but demand trends may even prices out in 2010.December 17, 2009 - Industries
that use sulfuric acid—and that includes nearly all the major manufacturing
sectors—have suffered a body blow from the faltering economy. As a result, demand for
sulfuric acid has plummeted over the past year, sending prices on a downward spiral. And
while experts say those prices may inch upward a bit in 2010 as the economy perks up, the
volatility in sulfuric acid prices that occurred in the 2008–2009 period is very
unlikely to return. Himfr Analyzes
Chinese Sulfuric Acid Market
December
2, 2009 - In November, the Chinese price of sulfuric acid as a whole experienced
an upward trend. Now, 98% of sulfuric acid prices are 300 RMB/ton, increasing about 9.9%
over October. The sulfuric acid market trends differ between North and South China. The
overall rise in price in the North relies mainly on market pull, concentrated in Hebei,
Tianjin and Shandong provinces, where sulfuric acid prices are sharply rising. North Market
Sulfuric Acid Price Rising Hebei, Tianjin and
Shandong sulfuric acid manufacturers in the north have raised sulfuric acid prices to the
range of about 80-180 RMB. The reasons are: 1. Shandong copper
smelters, affected by higher international copper raw material costs and the lower
processing fees, have made sulfuric acid production abnormal, and with the deployment of
part of the smelter acid factory park maintenance, this has led to tight market supply. 2. In the
international market, the impact of rising sulfur prices has caused elevation of Chinese
sulfur prices. By the end of
November, the Chinese solid sulfur prices were 620 or so; in the short term, sulfuric acid
prices will remain high. Under various favorable factors, the downstream market demand is
relatively stable, northern areas sulfuric acid prices remain high. From the current
market situation, from fertilizer to storage, accounting for the export tariff reduction
and other favorable factors, the operating rate of Chinese phosphate fertilizer business
has improved; the north China sulfuric acid situation is good, inventories are small, but
the market outlook is more optimistic. Himfr expects that this improvement will continue
until the end of December. South Market in
Weakness Compared with the
northern region's sulfuric acid market situation, the southern region's sulfuric acid
market is relatively weak. Sulfuric acid prices are in varying degrees of decline;
concentrated in the Zhejiang, Hunan and Hubei regions, the decline range is about 50-100
RMB. Sulfuric acid (http://himfr.com/list-product-Agriculture-01000000-1.html
) prices drops in south area are because of a general increase in pre-load of fertilizer
production enterprises, which basically already met the Chinese demand for fertilizer in
autumn. Judging from the current market situation, in Jiangsu and Hubei provinces,
sulfuric acid prices appear to be rebounding. Himfr expects that sulfuric acid market will
basically remain stable. Himfr reports that
for the Chinese fertilizer, pesticide and other industries in the production preparation
period, the raw material prices will rise slightly in December. In the short term, the
oversupply situation of sulfuric acid will not change.
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