The bearishness trend persists in Saudi Arabia and the US Sulphuric Acid Market, with demand concerns
- 17-Nov-2023 12:14 PM
- Journalist: Shiba Teramoto
Jeddah, Saudi Arabia: In the Saudi Arabian market, Sulphuric Acid showcases a lower to steady price trend along with its feedstock, Sulphur, due to the manageable market situation. However, in the USA, the prices of the Sulphuric Acid are experiencing a downward fall after remaining constant for a few weeks. The overall demand is low along with the well-supplied stocks, resulting in feeble market purchases. Nevertheless, the buyers are trying to stock out their inventories after being open for negotiations for discounts during new purchases.
Sulphuric Acid is following a stable price trend in the week ending on November 17, 2023, with USD 57/MT (Ex-Jeddah). The steadiness in the price trend is attributed to ample inventory levels and moderate demand from downstream Agrochemical enterprises, leading the producers to reduce the production rates for Sulphuric Acid. Simultaneously, the prices for Sulphur in the upstream market also experienced a decline, contributing to a drop in the operational costs for Sulphuric Acid. The trade from China to Saudi Arabia slowed down as the existing inventories were adequate to meet the demand from the downstream Agrochemical market. However, the consumption of the existing inventories was continuous with constant restocking of the Sulphuric Acid. Therefore, the supply/demand equilibrium was maintained by the suppliers and buyers.
In the USA, Sulphuric Acid is experiencing a bearish price trend with less liquidity for purchasing transactions. On the week ending on November 17, 2023, the prices of the commodity reached USD 66/MT (FOB-Linden NJ), after being constant for a few weeks. Dull demand from the downstream Agrochemical enterprises is leading to high stocks which is further resulting in decreasing the prices for the commodity. Furthermore, the spread is less between products, Sulphuric Acid, and its feedstock, Sulphur showcasing the declining profits for traders and the overall weak market situation for Sulphuric Acid. Considering the market situation for the commodity, the buyers have started restricting their purchasing activities, so the overflows of the commodity do not occur, which is making suppliers conscious. Moreover, traders have started giving discounts on bulk purchases to improve their profit margins so that the buyers could be persuaded to increase their purchasing activities.
According to ChemAnalyst, Saudi Arabian and US Sulphuric Acid may showcase an upward price trend due to the upcoming winter sowing season with healthy product utilization from the end-users. This may elevate the demand from the downstream Agrochemical enterprises with increased uptake of the inventories from the storage units. This possibly strong market situation may enhance trading activities among the significant manufacturing industries. Therefore, the production rate may increase due to the high demand from the downstream Agrochemical markets.