U.S. Gulf:
Market players expected sulfuric acid imports to fall in a $50-$55/mt CFR range for the week, unmoved from the previous report. The Brazil market was similarly unchanged at $55-$60/mt CFR, with smelter tons from Northwest European producers heard to run $15-$20/mt FOB. Some market players speculated that recent cooling reported in the international sulfuric acid markets would soften pricing in the next round of business.
In the domestic market, sources described Gulf supply as tight for the near-term, tracing the conditions to turnarounds and maintenance issues rumored at PCI and Veolia. Firming was described as a result, with Gulf market tons generally heard at $95-$100/t DEL, up from $90-$100/t DEL at last check.
Midwest product was described at $80-$90/t DEL, unchanged from one week earlier, while material delivered to the West Coast was flat at $100-$110/t.
China:
Leading aluminum producer China Hongqiao Group announced smelter curtailments last week, Platts reported. The 250,000 mt/y reduction – considered relatively minor compared to both the company’s 7-8 million mt/y capacity and the Chinese market’s expected 44 million mt/y output for 2017 – was nevertheless expected to motivate other firms to follow suit.
The cuts were mandated by a Chinese central government eager to reform smelter industry production. Edicts handed down in February and April called on aluminum and steel producers in the Hebei, Shanxi, Shangdong, and Henan provinces to slash outputs during winter months in order to help reduce air pollution, as well as those found in violation of China’s evolving environmental guidelines. A Bloomberg report termed Hongqiao’s capacity cut as limited to “outdated” capacity.
Following Hongqiao’s announcement, Xinjiang producer East Hope Group announced plans to begin smelter reductions of its own, starting at the end of June.