The impact of sulfur on sulfur dioxide prices in 2025

The impact of sulfur on sulfur dioxide prices in 2025

1. Industrial chain transmission mechanism

Sulfur is the core raw material for sulfur dioxide production, accounting for approximately 30%-50% of the production cost (the specific proportion varies depending on the process). Since 2025, global sulfur prices have continued to rise due to supply chain contraction (such as OPEC+ production cuts and Canadian natural gas production capacity reduction). The domestic spot price at Zhenjiang Port has reached 3,330 yuan/ton, an increase of 115% from the beginning of the year, and the international CIF price has simultaneously increased to 277.5 US dollars/ton (an increase of 50.4%). This cost pressure is directly transmitted through the "sulfur → sulfuric acid → sulfur dioxide" chain, causing the production cost of sulfuric acid companies to increase by 200 yuan/ton, and the industry's average gross profit margin dropped to -9.32%.

2. Price linkage characteristics

1. Cost-push increase:

For every 600 yuan/ton increase in sulfur price, the sulfur dioxide production cost increases by approximately 140-200 yuan/ton. Data from Q1 of 2025 show that the price of liquid sulfur dioxide in the Asia-Pacific region has shown a dual-round upward trend of "cost-side driven and demand-side supported" due to rising sulfur prices and the peak season for fertilizer demand. The spot price in the Indian market has reached US$16,200/ton.

2. The contradiction between supply and demand amplifies fluctuations:

The structural fragility of the sulfur supply chain (dependence on by-products and low inventory turnover efficiency) exacerbates price fluctuations, while demand for sulfur dioxide is concentrated in rigid fields such as fertilizers and semiconductors, resulting in a significant price correlation between the two. For example, after sulfur prices skyrocketed in March 2025, domestic sulfur dioxide terminal prices rose by 300 yuan/ton within one month, and some companies suspended orders due to out-of-control costs.

3. The regulatory role of policy and technology

1. Impact of environmental protection policies:

The promotion of low-carbon technologies (such as flue gas desulfurization, by-product sulfur dioxide recovery) reduces reliance on primary sulfur. For example, the titanium dioxide industry uses "low concentration flue gas recovery" technology to utilize the by-product sulfur dioxide as a resource, replacing 15%-20% of the demand for sulfur raw materials.

2. Phosphate fertilizer companies use phosphate ore flotation enrichment technology to reduce sulfur consumption by 5%. Sulfur-based compound fertilizer companies explore alternative processes for natural potassium sulfate to reduce dependence on sulfur-derived sulfuric acid. However, it is difficult to change the cost transmission logic in the short term.

Four. Judgment of future trends

Sulfur prices are expected to remain high and fluctuate (12-month forecast of 2,826.52 yuan/ton), and the sulfur dioxide market will show the characteristics of "strong cost support and steady demand growth":

Short term: The peak season for fertilizers (such as the khairf planting season in India) and the expansion of the semiconductor industry (demand for electronic grade sulfur dioxide increased by 4.7% annually) will support prices.

Long-term: The transformation of the global energy structure and the recovery of sulfur production capacity may gradually ease the contradiction between supply and demand, but increased environmental protection policies may prolong the high price cycle.