Global Ammonium Sulphate Market Declines Due to Weak Demand and Weather Challenges

The global Ammonium Sulphate market experienced a decline during the inaugural week of September 2024. Despite an increase in the price of essential feedstock Ammonia during this period, the upward cost pressure had a limited impact on Ammonium Sulphate prices. The subdued market conditions were primarily driven by weakened demand of fertilizers including Ammonium Sulphate, as adverse weather conditions and the conclusion of peak seasonal requirements dampened global consumption. Consequently, the combination of these factors contributed to the softening of Ammonium Sulphate prices, as the market faced minimal upward pricing pressure from supply-side costs.

Ammonium Sulphate prices persisted downward trajectory in the North American market during the first half of September 2024 due to weak summer demand and bad weather. International demand, especially from India, was not met after the Indian National Fertilizer Limited (NFL) deadline was extended to October 31. The delay indicated that there was no need to supply additional volumes of fertilizers including Ammonium Sulphate before the Rabi season. The domestic demand for Ammonium Sulphate had remained restricted after the country was hit hard by Tropical Storm Francine, raising concerns about crop damage and post-harvest delays.

Despite this, the United States has maintained an adequate supply of Ammonium Sulphate and has maintained stable supply levels. However, there are many challenges that come from labour problems. The International Longshoremen's Association, which represents workers at 36 major US ports, has warned of a strike and a new labour contract by September 30. The problems are likely to be more serious, particularly affecting imports of Ammonium Sulphate from Europe and Latin America, although imports from Asia will be less affected.

In like manner, the prices of Ammonium Sulphate declined in the Asian market with India and South Korea being the most affected region. In the Korean market this decline is attributed to a narrowing gap between supply and demand. On the demand side, both domestic and international consumption of Ammonium Sulphate remained notably weak. Key export markets like India saw demand falter due to unfavourable weather conditions, including excessive rainfall, which has prompted many buyers to delay purchases. This hesitation from India, a major importer, contributed to the global oversupply. Domestically, demand has been equally subdued, driven by weather uncertainties. Meanwhile, on the supply front, Korea continues to grapple with logistical bottlenecks, particularly port congestion, which has resulted in stockpiled inventories. Additionally, the threat of a labour strike in Korean shipyards, following failed wage negotiations, is likely to exacerbate supply chain inefficiencies. With high supply levels and muted demand, the market remains bearish, raising concerns of further price fluctuations in the near term.

As ChemAnalyst indicates, Ammonium Sulphate prices may fall in the international market in the coming days due to weak seasonal demand and adverse weather conditions.