Soft demand drags price ideas down

摘要

The spot market is lacklustre across the globe as buyers claim to be covered for immediate needs. In China and India in particular, consumers would rather wait for sulphur prices to fall further and more clarity from the phosphates market before locking in commitments. This led to much discussions over whether the settlements of phosphoric acid (phos acid) contracts between OCP Morocco and Indian buyers will have a positive impact on sulphur trading. To begin with, the now half-yearly settle- ments wrapped up negotiations that have been very delayed and may provide a stabilising sentiment now that OCP has secured an outlet for its product till the end of June. The price agreed is $805/t P2O5 cfr with 30 days' credit, $40/t above the 2H14 level. Indian fertilizer production in the coming three months will be relatively high-cost, and this may stimulate the need for cheap DAP imports from China, Jordan and Saudi Arabia although lower ammonia costs may well offset the effect. Its impact on sulphur trade, however, is not straight forward. While India may import less sul- phur between April and June, the need for sulphur for the production of phos acid in Morocco should rise relatively. It is not expected to contribute to any drop or increase of sulphur demand but provide a psychological comfort to phosphates players.