Overflowing Inventories Negatively Catalyses the Market Growth of Copper Sulphate Across the APAC Region
- 22-Nov-2022 2:55 PM
- Journalist: Gabreilla Figueroa
The economic uncertainties unleashed by the inflationary pressures and COVID cases in China have impacted the pricing index of several raw materials required in the production of agrochemicals, including Copper Sulphate. The adverse cost support from upstream sulphuric acid has also weakened the market sentiments of Copper Sulphate across the APAC region.
Being an agrarian economy, India is the second-largest consumer of fertilizers and the third-largest manufacturer. The market players from the fertilizers industry have procured Russian goods at discounted prices, surging the Indian fertilizer imports to a record high of 2.15 million tonnes, leading to sufficient product availability in the domestic region. As a result of oversupply, the demand for one of the input materials required in fertilizer production, Copper Sulphate, has gained a downward momentum. Furthermore, the Ministry of Chemicals and Fertilizers has also stated that abundant fertilizers are available in the country to meet requirements for the ongoing Rabi sowing season.
On the upstream front, a leading market player, Hindustan Copper Ltd (HCL), has increased copper ore output from the Malanjkhand project in Madhya Pradesh to 2.2 million tonnes from 1.6 million tonnes, and it would eventually be expanded to five million tonnes in the upcoming five years as per the company authorities.
Furthermore, in China, the enduring COVID curbs and slowdown in inquiries from the international market have reduced the exports of Copper Sulphate. The market players have reported that the supply is relatively sufficient and procurement from the downstream fertilizer industry was inadequate to cause high-price operations.
As per ChemAnalyst, the price trend of Copper Sulphate will remain under pressure under adequate availability of the downstream fertilizers in the APAC region. With the slowdown in global demand, the falling exports will have a knock-on effect on the Copper Sulphate manufacturing sector. Thus, it is anticipated that despite the ongoing Rabi sowing season, the overflowing fertilizers inventories will impose a downside risk to the market growth of Copper Sulphate in the forthcoming weeks.