Global Nitric Acid Market Didn’t Meet the Projected Favourable Outlook in Q2

The Nitric Acid market sentiment remained unchanged from the previous quarter, owing to increased demand from the downstream Aniline market and increased stockpiling. In India, the Ex-Depot Mumbai Nitric Acid prices surged in April, averaging over USD 696/MT, showing high demand and concerns about an impending supply shortage. Manufacturers on the other hand, were pressurised by logistics challenges and hiked freight costs in the backdrop of skyrocketing fuel charges.

In April, Nitric Acid prices in the United States increased by approximately 3%. This sharp increase was attributed to rising upstream natural gas and coal prices and a disrupted supply chain caused by western sanctions against Russia, the world's largest exporter of feedstock Ammonia. As a consequence of the sky-high fertilizer prices, farmers are using Nitric Acid on a need basis, which is a significant negative element in the regional market. Manufacturers appeared to be under little pressure to adjust their offers during the spring season. As a result of the strong demand, price negotiations for Nitric acid 98% FOB New York were stable in April at USD 390/MT.

Germany's prices of Nitric Acid increased by 2.5 percent in April, owing to the strong downstream demand. The rising demand for Nitric Acid in Germany's domestic market was prompted by a global increase in the demand for fertilizers. In addition, demand for another downstream product, polyurethane, was high, causing Nitric Acid prices to rise. Furthermore, rising crude oil prices amidst Russia-Ukraine war tensions increased the upstream cost of Nitric acid, resulting in a price increase. Overall, high demand for fertilizers and polyurethane and rising energy costs drove up Nitric Acid prices in Germany. Finally, Nitric Acid's 98 percent FOB Hamburg rates were estimated to be USD 4345/MT.

As per ChemAnalyst, "Manufacturers of nitric acid are expected to be in turmoil as the demand-supply imbalance widens. Short inventories are putting increasing pressure on manufacturers, which is anticipated to raise offers in the global market in the coming weeks."