US Magnesium Sulphate price surge amid slump in Chinese Exports

The price trend for Magnesium Sulphate displayed bullish movement in the USA as import quotations rose noticeably by 12.6% in April 2024. The export rates from major exporter China experienced a decline, and supplies remained tight from Asian exporters. The key Magnesium Sulphate manufacturers in China, such as Sure Chemical Co., Ltd. in Shijiazhuang, urged their customers to ramp up their purchase orders at the end of February 2024 to mitigate market fluctuations. Subsequently, consumers followed suit and increased their orders, leading to the rise in product prices amid increased production costs.

The production costs of Magnesium Sulphate increased in China amid sluggish availability of its feedstock Sulphuric Acid, propelled by an escalation in demand for agrochemicals from Southeast buyers amid the planting season. Simultaneously, upstream Sulphur availability was affected by the drop in refinery operations followed by the announcement of Crude Oil production cuts by OPEC+ and a decline in supplies in the international markets amid geopolitical tensions. At the same time, feedstock Magnesium supplies were moderately available as producers reduced their production rates due to elevated production costs amid the country’s shift towards cleaner energy sources, with buyers reluctant to accept higher material costs. 

At the same time, the international air cargo market experienced increased demand driven by e-commerce expansion and shipping disruptions in the Red Sea, impacting air freight rates. Simultaneously, ocean rates continued to decline, negatively affecting product supplies in the market.

The demand for Magnesium Sulphate was firm from domestic buyers for stocking purposes. Orders were robust from agrochemical industries amid rising demand from domestic buyers during planting season. At the same time, Magnesium Sulphate demand for bath salt was firm in beauty and wellness industries for exfoliating purposes after the rise in temperatures in the Northern Hemisphere. Concurrently, the food sector exhibited a surge in demand for Magnesium Sulphate as a coagulant in tofu production in the food sector due to increased consumer orders and consumption rates.

At the end of April 2024, the Magnesium Sulphate CFR USGC quotations in the USA witnessed USD 500/MT.

As per the estimation, the demand for Magnesium Sulphate is likely to remain firm during the mid-quarter of Q2 2024. Consumption rates for Bath Salt from the beauty and wellness sector are expected to rise during summer. However, the availability of Magnesium Sulphate inventories may remain moderate to low in the market because of increasing freight charges and air freight volumes amid the Red Sea crises.