Viewpoint: Sulacid supply to grow in North America

The merchant sulphuric acid market in North America will lengthen in 2020 as production outages end at key producers, while new demand will not fully absorb additional supply production.

In Canada, Teck Resources is expected to repair an electrical equipment failure at its smelter in Trail, British Columbia, by the start of 2020. Sulphuric acid production from the smelter declined because of the outage that began 25 August.

Grupo Mexico's Hayden smelter may also restart production next year should the company and union workers on strike at its facilities in Arizona and Texas since October reach an agreement. The smelter has the capacity to produce about 600,000 t/yr of sulphuric acid, and resumed acid production would return some balance to the western US acid market.

The newly commissioned import terminal at Stockton, California, will also contribute to growing supply in the western US. SATCO, the US sulphuric acid distribution arm of Japanese trading house Sumitomo, received its first cargo from Japan in October. The facility is set to become another source of supply for western US consumers. The company plans to eventually sell 200,000 st/yr through the facility.

The closure of Glencore's New Brunswick smelter by end-2019 will lower supply by 150,000-200,000 t/yr. But the smelter primarily served the offshore market — 96,000t was shipped offshore between January-September 2019 — and so its closure alone may not significantly affect the supply balance in the US and Canada.

New sources of acid demand will arise in 2020, though their initial consumption will likely be too low to have a noticeable effect on the market in the near-term.

US fertilizer producer Anuvia Plant Nutrients plans to utilize a shuttered Mosaic facility in Plant City, Florida, to produce NPS fertilizers. At full capacity the plant would require 500,000-600,000 st/yr of acid, although it is unclear how quickly production will increase at the facility.

Demand will also develop at Excelsior Copper's Gunnison mine in Arizona, which will require acid from the domestic market to leach copper from mined ore. The mine will consume 500,000 st/yr yearly by the late 2020s, but consumption in 2020 will likely be around 50,000st, according to the mine's feasibility study.

The coming year will bring new selling opportunities in the merchant market, but growing length is likely to limit upward price movement.

By Reggie Thompson