India’s phosphoric acid price rises 25% as higher sulfur costs impact the phosphate market

India’s benchmark phosphoric acid contract price for the third quarter increased 25% to $1,700 per tonne P₂O₅ CFR, reflecting the rapid impact of higher sulfur costs throughout the phosphate fertilizer supply chain. Coromandel International finalized the July-September contract with Jordan’s JPMC on 30-day credit terms, according to Argus Media. The new price is $340 per tonne higher than the second-quarter price of $1,360 per tonne, which had already risen from $1,290 per tonne in the first quarter under Coromandel’s agreement with Nutrien.

This sharp increase is driven by higher sulfur prices, which are essential for phosphoric acid production. Dry-bulk sulfur delivered to Indian ports rose about 49% in the second quarter. Abu Dhabi’s Adnoc set its July sulfur contract price at a record $1,000 per tonne FOB Ruwais, up $140 per tonne from June. Since phosphoric acid is the main raw material for diammonium phosphate (DAP), the higher contract price is expected to raise DAP production costs during India’s peak kharif planting season, when fertilizer demand is highest.

Market participants expect phosphate input costs to remain high through the third quarter, as sulfur supplies remain limited and freight and risk premiums related to the Strait of Hormuz decrease only gradually.

Source: Argus Media