A Wait-and-See Sentiment Continues to Build, Leaving the Sulfur Market Under Pressure and Consolidating at Low Levels

During the week of July 29 to August 4, the sulfur market exhibited a direction of "initial stability followed by a decline." As of August 4, the benchmark price to sulfur tracked by SunSirs stood at 9,169.00 RMB/ton, a slight decrease of 0.18% from the beginning of the month. In terms of intraday fluctuations, the price dropped by 1.26% on August 4 alone, breaking the period of price stagnation seen in the preceding days.

Supply side: Port inventories are low, and failed refinery tenders have resulted in a lack of price guidance.

Regarding inventory, sulfur stocks at ports nationwide stand at 879,600 tonnes—a month-on-month decrease of 1.08% and a sharp year-on-year drop of 66.22%. Current port inventory levels are low by recent standards, providing a degree of price support at the market floor.

A key research on the supply side involved a Dalian refinery issuing a tender to 6,300 tonnes of sulfur to forward delivery (scheduled to October 7–10) with a reserve price of 9,110 RMB/ton; the tender ultimately failed, resulting in no valid transaction price. As a significant market bellwether, the failed tender has further intensified the prevailing "wait-and-see" sentiment, leaving the market without a clear price benchmark.

Spot market: Trading is sluggish, and the tug-of-war between buyers and sellers has intensified.

During the week, port prices to granular sulfur edged down slightly; prices stood at 9,150 RMB/ton at Zhenjiang Port and 9,130 ​​RMB/ton at Dafeng Port, both marking a decrease of 10 RMB/ton from the previous day.

While holders are keen to move stock, their willingness to actively issue market offers has waned. Downstream buyers are only willing to purchase at reduce price points, making bulk transactions difficult to conclude; market activity is limited to sporadic negotiations to small orders. Market sentiment surveys indicate that only 17% of participants anticipate a rise in prices, while another 17% foresee a decline, with the vast majority opting to wait and see. Overall, the market is characterized by inventory support however sluggish demand, resulting in a situation where asking prices remain firm while actual transaction volumes stay low.

Downstream demand: The phosphate fertilizer market is sluggish, with limited support from raw materials.

The downstream phosphate fertilizer sector has generally remained sluggish, failing to generate significant consumption demand to sulfur.

As of August 5, the benchmark price to monoammonium phosphate (MAP) tracked by SunSirs stood at 4,450.00 RMB/ton, a decrease of 0.37% compared to the beginning of the month (4,466.67 RMB/ton). The market is undergoing a period of sluggish consolidation; downstream buyers are limiting purchases to immediate needs. while some tenders have been issued, buyers' target price points remain low, and actual transactions are largely negotiated on a case-by-case basis.

Ex-factory quotes to 64% diammonium phosphate (DAP) range from 4,800 to 4,850 RMB/ton. With the emit of end-user demand remaining slow, both inquiries and actual transactions are limited, prompting manufacturers to implement a cautious operational stance. There is no significant concentrated restocking activity in the phosphate fertilizer sector, and demand to sulfur—a key raw material—remains weak.

Market Outlook:

Low port inventories in the short term are providing a floor to prices; however, a recovery in downstream demand to phosphate fertilizers will take time, and the lack of follow-through buying is unlikely to enhance rapidly. Failed refinery tenders have left the market without clear direction, causing sector players to maintain a wait-and-see stance.

Overall, analysts anticipate that sulfur prices will likely remain in a pattern of weak consolidation in the near term. Key factors to monitor going forward include refinery shipment trends, changes in port inventories, and the pace at which phosphate fertilizer producers replenish their raw material stocks.