For the Quarter Ending September 2024
North America
During the third quarter of 2024, the price of Ammonium Sulphate in North America exhibited an overall downward trajectory. This price decline can be attributed to several factors, including diminished demand from the downstream fertilizer sector amid inadequate weather conditions across the country. With the peak planting season having passed, immediate demand for fertilizers decreased during the initial months of the quarter.
While there were expectations that consumers might begin purchasing in preparation for the upcoming planting seasons for wheat, rye, and rice, hurricanes and storms in the region significantly impacted this anticipated demand. According to the U.S. Department of Agriculture (USDA), 47% of the corn crop has been harvested, while only 1% of soybeans have been collected in North Carolina, with no available data for South Carolina. This situation underscores the substantial disruption to crop progress in the American region.
By the end of the quarter Q3, the price of Ammonium Sulphate FOB Illinois was reported at USD 406/MT.
Asia
Throughout the third quarter of 2024, the prices of Ammonium Sulphate in the Asian region exhibited a mixed trend. Prices increased in both the initial and final months of the quarter, while experiencing a decline in the second month. In the initial month, the price increase was primarily driven by a shortage of Ammonium Sulphate in the domestic market, exacerbated by severe weather conditions that disrupted production. China faced a series of windstorms and typhoons, significantly hindering manufacturing activities. Notably, Typhoon Yagi disrupted operations in September, with further disruptions anticipated as Typhoon Bebinca was forecasted to impact the southern coast of the country. These adverse weather conditions not only affected supply but also created logistical challenges, leading to tightening inventories and exerting upward pressure on Ammonium Sulphate prices. On the demand side, the market remained bearish throughout the quarter, influenced by weak domestic and international demand. By the end of the quarter, the price for Ammonium Sulphate 21% Spot EXW Shijiazhuang in China was reported at USD 135/MT.
Europe
Throughout the third quarter of 2024, the European Ammonium Sulphate market experienced a significant uptrend in prices, reflecting various underlying factors. The quarter was marked by a gradual increase in pricing, primarily driven by rising costs of essential feedstock such as Ammonia and Sulphuric Acid, which exerted upward pressure on Ammonium Sulphate prices. A critical aspect of this price increase was the upstream shortage of Natural Gas in the region, exacerbated by ongoing tensions between Ukraine and Russia. This geopolitical instability has disrupted supply chains and raised concerns about feedstock availability, further impacting production costs for Ammonium Sulphate. Despite currently low agricultural activities, fluctuating demand from the agriculture sector and anticipation of future market trends favoured sustained growth, contributing to the price surge. The overall supply-demand dynamics remained finely balanced, supporting the escalation in prices. Germany, in particular, experienced the most significant price changes in the region, mirroring broader trends observed throughout Europe. Seasonal factors and heightened demand from the downstream fertilizer sector played a crucial role in driving prices upward. As the third quarter concluded, the latest price for Ammonium Sulphate FOB Hamburg in Germany reached USD 255/MT, signalling a positive pricing environment with a consistent upward trajectory.
For the Quarter Ending June 2024
North America
In Q2 2024, the North American Ammonium Sulphate market experienced a notable increase in pricing during the first two months of the quarter, driven by several key factors. Strong domestic demand, particularly from the agricultural sector, was fuelled by favorable planting conditions and high seasonal demand for fertilizers.
Concurrently, rising prices of essential feedstocks, such as ammonia and sulfuric acid, significantly increased production costs, contributing to the higher Ammonium Sulphate prices. Logistical challenges and reduced export activities, caused by lower water levels in major shipping routes, further exacerbated supply constraints and intensified the price increase. However, in the final month of the quarter, prices fell by 1.5%. Geomagnetic storms and weather anomalies led to planting suspensions, which, combined with ample supply and cautious purchasing behaviour, helped narrow the demand-supply gap and exert downward pressure on prices.
As the quarter concluded, the Drought Monitor, released on June 20th, reported no areas of drought in southern Minnesota and northwest Iowa. Despite this, farmers adopted a wait-and-see approach to securing fertilizers, including Ammonium Sulphate, in anticipation of further price declines.
APAC
During the second quarter of 2024, the Ammonium Sulphate market in the Asia-Pacific (APAC) region witnessed a notable decline of 6.4% in prices during the first month. This decrease was driven by several key factors that influenced market dynamics. One of the primary contributors to the price reduction was the easing of freight charges, which, coupled with an abundant supply of materials, exerted downward pressure on prices. Additionally, export restrictions imposed by major suppliers further limited market activity, creating an environment where supply outstripped demand. This situation was exacerbated by subdued demand from the downstream fertilizer market, as peak seasonal requirements had already been met, leading to reduced procurement activity. Adverse weather conditions, including heavy rainfall and snowstorms across various regions, negatively impacted agricultural activity, further reducing the need for fertilizers. However, the prices surged by 4.7% and 5.7% respectively in the final two months of the quarter owing to oversupply of Ammonium Sulphate amid stable demand and a lack of new bids or inquiries from the international market, which led to a surplus that exerted significant downward pressure on prices. Focusing on China, where the most pronounced price changes occurred, the market was characterized by a consistent bearish sentiment. Despite the seasonal planting activities, the demand remained subdued, further exacerbating the price decline.
Europe
In Q2 2024, the European Ammonium Sulphate market experienced a marked decline in pricing, driven by several critical factors. Overall, the quarter was characterized by a bearish sentiment, largely influenced by fluctuating demand and adverse weather conditions that disrupted agricultural activities. The primary driver behind the persisting low demand was the severe weather, which included frequent windstorms and excessive rainfall, leading to waterlogged fields and delayed planting schedules. This, in turn, reduced the immediate necessity for fertilizers, including Ammonium Sulphate. Additionally, the fluctuating costs of essential feedstocks like ammonia and sulfuric acid further complicated the market dynamics, although these factors did not exert as significant an upward pressure on prices due to the overall muted demand. Focusing on Germany, which observed the most substantial price changes, the trend was consistently negative throughout Q2. The country experienced a -36% price change compared to the same quarter last year, underscoring a significant year-over-year decline. Seasonal factors, such as the adverse weather conditions and the subsequent impact on agricultural schedules, played a crucial role in this persistent decline. The latest quarter-ending price of USD 247/MT for Ammonium Sulphate FOB Hamburg encapsulates the overall negative pricing environment, highlighting the sustained bearish sentiment in the German market.
For the Quarter Ending March 2024
North America
The North American Ammonium Sulphate market experienced optimistic market sentiments throughout the first quarter of 2024. At the onset of the quarter, a modest upswing in the demand for Ammonium Sulphate was observed in both the North American fertilizer markets, attributed to improved weather conditions within the country.
Further, demand from importing South American market also revived amidst ongoing planting season of crops such as Corn, Cotton, and Sorghum after relief from prolonged drought conditions in Rio de Janeiro, brought about by torrential rain, marked a positive development in the region. However, as the month progressed, a reduction in production activities became apparent due to freezing temperatures and snowstorms. Severe winter conditions led to the closure of the U.S. Nitrogen LLC plant in Tennessee and the Yara/BASF JV plant in Texas, raising concerns about broader supply chain impacts.
Additionally, a disruption in the Ammonia gas pipeline at the Bethpage ice rink, resulting from a compressor malfunction, caused a shortage of Ammonia in the region. This shortage of a critical raw material exerted upward cost pressures on downstream derivatives, notably affecting Ammonium Sulphate prices. Overall, the price of Ammonium Sulphate in the North American region experienced an upsurge compared to the corresponding quarter of the previous year. As of the final quarter, the price for Ammonium Sulphate FOB Illinois in the USA stood at USD 340/MT.
APAC
In the first quarter of 2024, the pricing dynamics of Ammonium Sulphate in the Asia-Pacific (APAC) region presented a varied landscape, with South Korea emerging as the market most significantly influenced. Throughout the quarter, South Korea witnessed a notable escalation in prices, attributable to a confluence of factors extending beyond the conventional realms of influence. Central to this pricing surge was the sustained robust demand from the downstream fertilizer sector. Despite economic uncertainties, the fertilizer industry maintained its Intensity, driving continued demand for Ammonium Sulphate. However, this demand was juxtaposed against a backdrop of supply challenges and disruptions in the global supply chain. One pivotal event exacerbating supply shortage was the occurrence of plant shutdowns, notably including the Namhae Chemical Corporation. The facility endured flooding, hampering Ammonia production and consequently disrupting the supply chain for Ammonium Sulphate. The resultant scarcity of vital feedstock exerted upward pressure on production costs, contributing to the overall price surge in the market. Furthermore, the absence of China from the fertilizer export market during this period prompted Asian buyers, including South Korea, to explore alternative sources for Ammonium Sulphate. This shift in procurement strategies further accentuated the upward trajectory of prices. As the quarter drew to a close, the market in South Korea reached a price of USD 155 per metric ton for Ammonium Sulphate 21% Spot- Ex-Daejeon.
Europe
The European Ammonium Sulphate market faced a challenging first quarter in 2024, characterized by a substantial 1.8% decline in prices in Germany. This decline was primarily attributed to reduced demand from the downstream fertilizer sector, compounded by an oversupply of Ammonium Sulphate and muted overall demand. Additionally, market sentiments were dampened by trade uncertainties and unfavourable weather conditions, particularly in Russia. The weather across Europe varied significantly during the quarter, with cold spells in the northern regions, excessive rainfall in central areas, and dryness in the Mediterranean. These weather patterns influenced agricultural activities and fertilizer demand, further contributing to the subdued market conditions. Despite these challenges, the temporary maintenance shutdown of the Novomoskovskiy Azot (Eurochem Group) plant had minimal impact on prices. However, ongoing farmers' protests, fuelled by rising energy prices, played a significant role in reducing farmers' buying enthusiasm. These protests added further pressure on the already subdued demand in the fertilizer sector. In response to the inventory pressures faced by traders, various strategies were employed, including adjustments to fertilizer prices, including ammonia. These efforts aimed to alleviate the impact of declining demand and lower production rates on market dynamics. However, despite these measures, prices continued to decline throughout the quarter.
For the Quarter Ending December 2023
North America
In the fourth quarter of 2023, the North American Ammonium Sulphate market faced several challenges that impacted prices. Firstly, there was an oversupply of Ammonium Sulphate in the market, exacerbated by delayed exports and high freight charges.
This surplus availability led to a narrowing gap between demand and supply, resulting in a decline in prices. Further, the conclusion of the peak fertilizer season in the United States and subdued demand from international markets, particularly Brazil, further contributed to the downward pressure on prices. Another factor influencing prices was the bottleneck in the Panama Canal, which caused delays in shipments and accumulation of inventories within the country. However, despite these challenges, the demand for Ammonium Sulphate remained firm in the domestic fertilizer sector. Furthermore, some shipping companies are opting to bypass the Suez Canal due to concerns about potential rebel attacks, choosing alternative trade routes instead.
The limitations at the Panama Canal have compelled certain shippers to reroute exports, including Ammonium Sulphate, through the Suez Canal to access Asian markets. If the constraints at the Suez Canal persist, it may become increasingly challenging for the US to export Ammonium Sulphate, potentially resulting in an oversupply and subsequent reduction in prices. As a consequence of delayed shipments to the international market, there has been an accumulation of Ammonium Sulphate inventories within the country. The confluence of these factors has contributed to the stabilization of Ammonium Sulphate prices.
APAC
The fourth quarter of 2023 was challenging for the Ammonium Sulphate market in the APAC region. The market experienced a significant decline in prices, with South Korea being the most affected country. The main factors contributing to this downturn were the abundant availability of the material, persistent weak demand from the Asian region, and a decline in feedstock prices. After China’s National Development and Reform Commission (NDRC) has continued to halt exports of fertilizers there is surplus availability of material in the market. Further, with the autumn season sweeping away demand for Ammonium Nitrate from the end-user fertilizer market remained subdued. Additionally, manufacturing activity in South Korea showed signs of stabilization after a prolonged contraction period, leading to a slight increase in production and a mild reduction in new orders. However, the overall demand for Ammonium Sulphate remained low, and the market was characterized by high supply levels. However, later the prices increased by a significant margin. Increasing the price of essential feedstock Ammonia prompted higher production costs thus exerting upward cost pressure on Ammonium Sulphate prices. During this period, there was an absence in imports from the European Ammonium Sulphate market. The redirection of merchant ships from the Red Sea, prompted by the imminent threat of attacks from Houthi militants off Yemen, resulted in a notable surge in freight charges as many shippers altered their shipping routes. However, demand from the significant downstream fertilizer industry remained subdued, as the peak planting season had concluded.
Europe
The Ammonium Sulphate market in Europe during the fourth quarter of 2023 witnessed several factors that led to the declining price of Ammonium Sulphate in the market. Firstly, demand from the fertilizer industry remained subdued due to the completion of the peak planting season. Further, unfavorable weather conditions, including storm Ciaran and heavy rainfall, hindered the planting of winter crops, further dampening the demand for Ammonium Sulphate. Furthermore, the availability of the product in the global market was high, contributing to a surplus and putting downward pressure on prices. As December approached there was a major disturbance in a crucial trade route. The recent attacks on Red Sea trade by Yemeni rebels raised concerns about the safety of maritime traffic in the region, leading to disruptions in Red Sea trade that are expected to substantially impact global Ammonium Sulphate supplies. Shippers also imposed extra fees amid the trade disruption in the Red Sea, making Asian consumers hesitant to make bulk purchases. This has consequently led to a surge in inventories within the European market. The interplay of these factors prompted towards narrowed gap between demand and supply thus supporting the current price dip.
