Abu Dhabi's state-owned Adnoc has set its April sulphur official selling price (OSP) for the Indian subcontinent at $600/t fob Ruwais, up by $70/t from its March OSP.
Much of the Middle East's export supply has been shut in by the effective closure of the strait of Hormuz since the start of the regional war on 28 February, accounting for almost 50pc of global seaborne sulphur movements.
This has raised delivered prices significantly in the past few weeks, and while spot trading is thin amid a lack of availability, some buyers are willing to pay higher prices to secure limited supply. This applies particularly to metals industry consumers with more margin at current prices compared with fertilizer producers.
Adnoc's April OSP implies a delivered price of $636-638/t cfr India, with the freight cost for a 40,000-45,000t shipment to the east coast of India last assessed at $36-38/t on 26 March. Additional costs such as insurance premiums on top of higher bunker costs elevate delivered price levels further in addition to lower product availability. Freight costs have risen by 118pc since the onset of the conflict from $16-18/t on 26 February, excluding insurance cost increases.
While Middle East sulphur supply is at the moment subject to higher insurance costs and delivery times are uncertain, some buyers are still willing to book from the region to ensure raw material supply moving forward, with the current tightness expected to persist even after the conflict is resolved because of damage to some production sites and the increasing shipment delays on earlier sales.
