Tampa: Mosaic and PotashCorp on July 23 announced the conclusion of negotiations for the third-quarter price of molten sulfur delivered to Tampa, settling on an increase of $3/lt over the second-quarter price of $133/lt DEL. The updated price of $136/lt DEL will be retroactive to July 1.
Ample sulfur supply led industry watchers to expect a rollover or price decrease in the early stages of the negotiating process. Sources said rising international levels eventually tipped the conversation toward a modest increase, however.
Many have argued that the Tampa price should be much higher, based on international levels reaching into the $170s/mt FOB. But exceptionally high domestic supply levels resulting from a variety of factors – the BP Whiting expansion, PotashCorp’s Suwannee phosphate facility closure, and extraordinary refinery utilization numbers for the year, to name a few – have conspired to offset whatever upward price pressure the international market may have otherwise exerted domestically.
The price disparity has instead enticed some suppliers to seek additional channels to sell their product, such as increased production specifically targeted to offshore markets, or updating marketing strategies to sell offshore within the existing infrastructure.
Mosaic’s plan to import and remelt solid sulfur has provided extra impetus to set such plans in motion, sources said, as the means to direct product to the international market may be the best leverage suppliers are likely to have in future negotiations.
Operating rates for U.S. refineries maintained their eight-year highs for a second consecutive week, according to the U.S. Energy Information Administration (USEIA), with outputs put at 93.8 percent for the week ending July 18. The rate, unchanged from the previous week, was the highest refinery utilization percentage since June 23, 2006.
The current week’s numbers were higher than the 92.3 percent posted for the same week in 2013, as well as the five-year average of 92.2 percent.
U.S. Gulf: The Gulf export market was unchanged at $140-$145/mt FOB.
Vancouver: Preliminary third-quarter contract levels at Vancouver landed in a range of $140-$160/mt FOB, sources said, though further numbers were expected in the weeks ahead.
Firming international price levels, thanks in part to typhoon damage sustained to Chinese sulfur inventories, were said to lift spot prices to a range of $140-$170/mt FOB.
Syncrude continued to be sidelined by hydrogen sulfide gas-related issues, and had not yet returned to production as of July 24. Work on the issue was said to be ongoing, and no firm date to return to operation was released.
Sulfur produced in Alberta carried a price range of (-)$20-$80/mt.
West Coast: The price of sulfur sold from California was reported in a range of $135-$145/mt FOB, an increase from the previous price of $130-$140/mt FOB.
Benelux: Sources said the price of Benelux sulfur rolled over for the third quarter, remaining in a range of $158-$172/mt.
ADNOC: The July price of ADNOC sulfur was $170/mt.