Sulfuric Acid: The "Golden September" Fails to Materialize; Post-Holiday Market Shows Regional Divergence

【Introduction】: In September 2026, the domestic sulfuric acid market missed the traditional "Golden September" peak season. Supply-demand contradictions persisted throughout the month, leading to successive price declines. On the supply side, monthly maintenance losses amounted to 783,300 tons, with a capacity utilization rate of 64.01%. On the demand side, the operating rate for monoammonium phosphate (MAP) dropped sharply to 48.06%, while diammonium phosphate (DAP) stood at 47.68%. Titanium dioxide and caprolactam also saw slight reductions in load. The simultaneous weakness in both supply and demand resulted in sluggish new order transactions. Looking ahead to October, as autumn fertilizer demand winds down and winter stockpiling has not yet begun, coupled with weakening cost support from sulfur, the market is expected to maintain a pattern of weak supply and demand. Prices are likely to fluctuate at low levels, with significant regional differentiation.

1. Market Review

Table 1: Domestic Sulfuric Acid and Related Product Price List

Data Source: Chempricehub Information

Note: Prices for Yunnan, Hubei, Guangxi, Guizhou, Sichuan, and Fujian regions are delivered prices (ex-factory inclusive of tax for other regions).

In September, the domestic sulfuric acid market exhibited a sustained downward trend with widespread regional price drops. On the cost side, sulfur prices retreated from highs; the average monthly price of granular sulfur at Zhenjiang Port was 7,472 CNY/ton, a month-on-month decrease of 1,314 CNY/ton (-14.96%). Pyrite prices also declined, causing cost support to loosen and subsequently weaken. At the beginning of the month, the market continued the cooling trend from late August, characterized by sluggish trading activity. Supply-side units operated steadily, with some enterprises accumulating inventory. Demand-side fertilizer and chemical companies maintained rigid procurement needs, exhibiting strong wait-and-see sentiment due to insufficient positive drivers. Acid prices were lowered across Central, East, South, and Northwest China. By mid-month, maintenance units gradually restarted, increasing market supply and driving acid prices lower again. In parts of Anhui, Hubei, and Henan, smelter acid prices fell below 1,000 CNY/ton. Low-priced goods flowed into high-price regions, exacerbating bearish sentiment. End-users' "buy on rise, not on fall" mentality became increasingly evident. With the upcoming National Day and Mid-Autumn Festival holidays, acid producers faced pressure to reduce inventory, while downstream buyers intensified price negotiations, shifting the market towards a buyer's stance. By month-end, prices accelerated their decline in search of a bottom. Downstream users in high-price areas accelerated purchasing, significantly reducing enterprise inventories. Overall, strong supply versus weak demand persisted throughout the month. Cost support weakened, and expectations of pre-holiday inventory reduction and transportation restrictions suppressed market sentiment, leading to an accelerated price drop at month-end.

2. Data Analysis

In September, profits for all three types of domestic sulfuric acid production adjusted compared to the previous month. The profit for sulfur-based acid was -270.61 CNY/ton, a month-on-month increase of 50.55% but a year-on-year decrease of 1,847.55%. The profit for smelter acid was 1,090 CNY/ton, a month-on-month decrease of 22.83% but a year-on-year increase of 167.48%. The profit for pyrite-based acid was -170.58 CNY/ton, a month-on-month decrease of 38.12% and a year-on-year decrease of 5,162.97%.

The overall fluctuation in profits reflects the combined effect of falling raw material prices and declining sulfuric acid selling prices. This month, sulfur prices retreated from highs and pyrite prices declined, lowering production costs. However, sulfuric acid prices in many regions fell consecutively, with declines exceeding cost reductions. Consequently, profits for sulfur-based acid improved slightly month-on-month, while profits for pyrite-based and smelter acids decreased. Analyzing the divergence in profits among the three types: smelter acid benefits from cost advantages due to mineral-smelting symbiosis, maintaining the highest absolute profit levels. Pyrite-based acid turned unprofitable due to significant drops in sulfuric acid prices. Although sulfur-based acid remains in loss territory, the losses have narrowed substantially. In summary, the volatility in sulfuric acid industry profits in September was primarily driven by weak downstream demand, putting pressure on acid prices.

Table 2: Monthly Sulfuric Acid Supply-Demand Balance Sheet (Unit: 10,000 tons, CNY/ton)

Data Source: Chempricehub Information
① Total Supply = Output + Imports; Total Demand = Downstream Consumption (actual consumption in downstream markets) + Exports; Supply-Demand Gap = Total Supply - Total Demand.

From a supply-demand balance perspective, the sulfuric acid market in July-August featured a narrowing deficit under "increasing supply and stable demand." In September, this pattern reversed. The supply-demand gap in July was -54.39 ten-thousand tons, indicating tight supply and supporting an average price as high as 1,862 CNY/ton. Entering August, supply recovered significantly, with total supply increasing 4.13% month-on-month, while total demand rose only marginally by 0.38%. The supply-demand deficit narrowed sharply by 52.45% to -25.86 ten-thousand tons, driving the August average price down by 8.22% to 1,709 CNY/ton.

In September, the supply-demand structure is expected to shift from "tight balance" to "oversupply." Total supply continues to increase to 815.5 ten-thousand tons, but downstream consumption drops to 799 ten-thousand tons, leading to a 3.14% decline in total demand. The supply-demand gap will turn positive, resulting in a monthly surplus of 16.20 ten-thousand tons, marking a formal transition to oversupply. Burdened by these fundamentals, the September average price is forecast to fall further by 18.26% to 1,397 CNY/ton. Overall, as supply continues to expand and demand weakens, market pressure intensifies.

In September, domestic sulfuric acid output increased, raising the industry's overall operating load. The capacity utilization rate for sulfuric acid was 64.01%, a pullback of 0.77 percentage points from the previous period, representing a month-on-month increase of 1.22% and a year-on-year decrease of 3.25%. The incremental supply mainly came from the restart of previously maintained units. A total of 29 units underwent maintenance during the month, with aggregate lost output of 78.33 ten-thousand tons, a decrease of 6.16 ten-thousand tons from the previous month (-7.29%). The noticeable reduction in maintenance losses highlighted the prominent increase in supply.

Demand-side performance was weaker, with major downstream industries generally reducing loads. Phosphate fertilizers, the largest consumption sector, saw operating rates continue to slide due to the winding down of autumn fertilizer demand: MAP operating rate stood at only 48.06%, a sharp month-on-month drop of 6.78 percentage points. DAP capacity utilization was 47.68%, up 1.83 percentage points month-on-month but down significantly by 18.28 percentage points year-on-year. Additionally, titanium dioxide and caprolactam industries also showed signs of reduced production, with capacity utilization rates of 71.39% and 69.41% respectively, down 1.91 and 4.58 percentage points month-on-month. Simultaneous reductions across multiple downstream sectors led to procurement based solely on rigid needs, resulting in sluggish new order transactions. On the raw material side, the key input sulfur prices retreated from highs; the average monthly price of granular sulfur at Zhenjiang Port was 7,472 CNY/ton, down 14.96% month-on-month, causing cost support to loosen and weaken. In summary, both supply and demand in the sulfuric acid market weakened in September. Sustained supply expansion combined with load reductions across multiple downstream fields pressured market trading, leading to some inventory accumulation by acid producers.

3. Post-Holiday Trend Outlook

Looking ahead to October, as autumn fertilizer demand concludes and winter stockpiling has not yet commenced, coupled with weakening cost support from sulfur, the market is expected to maintain a pattern of weak supply and demand. Prices are likely to fluctuate at low levels, with significant regional differentiation.