Last week, the domestic sulfur market exhibited a pattern of high-level consolidation, a tug-of-war between supply and demand, and a moderation in upward momentum. Following a period of substantial prior gains, prices entered a plateau phase; traders and downstream manufacturers remained in a standoff, adopting a wait-and-see attitude, while market trends proceeded primarily sideways. Although fundamental factors continue to support high-level market performance in the short term, the momentum for further upward movement has somewhat diminished.

Price Trend Review: Stabilizing at High Levels, Upside Momentum Slows

1. Quarterly Trend Analysis (March–June)

According to data from SunSirs, sulfur prices in Shandong Province—starting from approximately 4,050 RMB/ton in early March—experienced three rounds of upward trends, climbing to around 7,500 RMB/ton by early June. This represents a cumulative increase of over 85%, marking a new interim high.

First Wave of Rally (March): Prices surged from 4,050 RMB/ton to approximately 6,700 RMB/ton, driven by plant maintenance shutdowns and declining port inventories, which fueled a rise in bullish market sentiment.

Second Wave of Correction (April): Prices peaked and subsequently retreated, undergoing a brief correction to around 5,800 RMB/ton; with downstream buyers adopting a cautious approach, the market entered a wait-and-see phase.

Third Wave of Upswing (May): Prices regained momentum from the 5,800 RMB/ton level, climbing steadily all the way to 7,500 RMB/ton; a concentrated release of demand—coupled with tightening supply—served to propel prices upward rapidly.

2. Market Performance Last Week (May 25 – May 31)

Last week, sulfur prices generally exhibited a pattern of high-level, narrow-range fluctuation, ultimately stabilizing at 7,500 RMB/ton.

May 25: The price was quoted at 7,566.67 RMB/ton, recording a slight increase of 0.22% and remaining at a cyclical high. May 26: The price retreated to 7,516.67 RMB/ton—a decline of 0.66%—as the market began to show signs of a correction. May 27–May 31: The price stabilized at 7,500 RMB/ton, with daily fluctuations registering zero, as the market entered a stalemate.

Analysis of Core Influencing Factors

1. Supply Side:

Maintenance activities at domestic refineries and natural gas-based sulfur production facilities remain ongoing; consequently, supply in certain regions is experiencing temporary tightness, thereby reinforcing market expectations of a supply contraction. Port inventories continue to hover at low levels, and the pace of imported sulfur arrivals has fallen short of expectations; this limited capacity to replenish supply provides underlying support to prices.

2. Demand Side:

Downstream phosphate fertilizer and chemical enterprises have reached the tail end of their traditional inventory-stocking cycle. Their willingness to procure at high prices has notably diminished; purchasing activity is now predominantly driven by immediate, on-demand requirements, resulting in a decline in overall market transaction volume. Manufacturers demonstrate low tolerance for high sulfur prices, while traders remain keen to hold firm on pricing; this divergence in price expectations between supply and demand sides has led to a market standoff.

Market outlook

In the short term, the sulfur market is expected to remain largely stable while oscillating at elevated levels; the core trading range is projected to lie between 7,300 and 7,700 RMB/ton, with the pace of upward movement slowing and volatility potentially intensifying.

Supportive Factors: Port inventories remain at low levels, import replenishment is insufficient, and maintenance shutdowns at certain production facilities are still ongoing; consequently, support from the supply side remains intact.

Pressuring Factors: Downstream resistance to high prices is intensifying, and inventory-building demand is drawing to a close; as a result, there is insufficient momentum for prices to continue their sharp upward trajectory.

Summary: Last week, the sulfur market entered a consolidation phase following an upward surge. From a technical perspective, bullish momentum has waned, though the overall trend remains intact; fundamentally, supply and demand have reached a fragile equilibrium at elevated price levels. For the coming week, particular vigilance is required regarding the risk of a short-term correction triggered by a "death cross" signal in the moving averages.

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