SunSirs: Impact of the Policy Change on Suspending Sulfuric Acid Exports on Phosphate Compound Fertilizers

Currently, sulfur and sulfuric acid prices are showing a clear upward trend. As key raw materials for phosphate fertilizer production, this trend has already placed significant cost pressure on phosphate compound fertilizer manufacturers. Recently, the market has been focusing on whether China will suspend sulfuric acid exports starting in May, while closely monitoring whether the implementation of this policy could bring about a turnaround in phosphate compound fertilizer market prices. In my view, if the policy is successfully implemented, it will undoubtedly provide strong support for the stability of domestic sulfuric acid supply; however, the pattern of high production costs for phosphate compound fertilizers is expected to persist in the short term.

Market rumors suggest that China will halt sulfuric acid exports starting in May, and some domestic sulfuric acid producers have reportedly received notifications regarding the policy change. This ban is said to cover sulfuric acid produced as a byproduct of copper and zinc smelting in China.

Although no official notification has been released yet, these rumors clearly reflect the core consideration of ensuring domestic supply and stabilizing prices, aiming to prioritize the stability of raw material supplies for related domestic industries.

As the world’s largest producer and supplier of sulfuric acid, China accounts for over 40% of global production. Data from global trade tracking agencies shows that in 2025, China’s sulfuric acid exports reached 4.6497 million metric tons. Of this total, exports from May to December amounted to 3.33 million tons, accounting for more than 70% of the annual export volume.

Currently, the ongoing conflict in the Middle East continues to escalate, causing severe disruptions to global raw material supply chains. Sulfuric acid is hailed as the “mother of industry”; it is not only an indispensable raw material for fertilizer production but is also widely used in metal smelting, petroleum refining, battery manufacturing, and the synthesis of chemical raw materials. According to SunSirs data, the domestic sulfuric acid price stood at RMB2,100 per ton on April 14, up 13.5% from the beginning of the month and 124% from the start of the year, reflecting a particularly pronounced upward trend.

The sustained rise in sulfuric acid prices has intensified cost pressures for downstream enterprises. Driven by constrained international supply and rising raw material costs, global fertilizer prices have surged significantly. Some international analysts predict that phosphate fertilizer prices could rise by more than 50%. This trend has sparked widespread concern across various sectors regarding global food production. China’s fertilizer prices have historically remained at a global low, with relatively minor fluctuations; however, against the backdrop of soaring raw material costs, some manufacturers still face significant cost pressures. Therefore, controlling sulfuric acid exports is of great significance for ensuring supply and stabilizing prices in the domestic fertilizer market.

However, even if export restriction policies are implemented as scheduled, the cost support for phosphate compound fertilizer prices will remain solid in the short term. China’s sulfuric acid market is primarily driven by a highly self-contained domestic cycle, with exports accounting for a relatively limited share. According to data from Longzhong Information, in 2025, China’s cumulative apparent consumption of sulfuric acid reached 105.3084 million tons, while exports accounted for only 4.42% of total consumption. Although the suspension of exports may affect market sentiment, domestic sulfuric acid prices are expected to remain at high levels in the short term due to multiple factors, including low inventory levels at domestic sulfuric acid producers, sustained strong market demand, and persistently high prices for raw materials such as sulfur. Consequently, production costs for phosphate compound fertilizers will continue to be supported, and their prices are likely to remain stable at high levels in the near term.

Consequently, enterprises must continue to confront the challenge of high costs and actively respond by strengthening cost control and optimizing market operation strategies. As for end-users, they should promptly adjust their market mindset and accurately gauge the timing of their operations to better align with market demand and mitigate potential risks.

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