Page 185 - CW E-Magazine (24-10-2023)

Special Report

ing sulphuric acid, which varies from Sulphuric acid prices in US$/tonne
smelter to smelter. But the selling price
of sulphuric acid does not depend on the 200
cost of smelters. Every seller – whether
a sulphur burner or smelter – competes 150
with another.
100
Sulphuric acid supply is generally
slow when it comes to matching de- 50
mand. The capital expenditure required –
for installing new capacity acts as a bar-
rier for a new entrant. Unlike commodi- -50 Apr-18 Aug-18 Dec-18 Apr-19 Aug-19 Dec-19 Apr-20 Aug-20 Dec-20 Apr-21 Aug-21 Dec-21 Apr-22 Aug-22 Dec-22 Apr-23 Aug-23
ties like gold, copper and oil, sulphuric
acid is not traded on any exchange, and Acid price through sulphur route Local Price Imported Acid
is not an asset class for investment. Fig. 6: Sulphuric acid price comparison
Thus, demand-supply dynamics dictate Source: Hindalco.
the price movement. Smelter acid is Table 5: Sulphuric acid imports to India
largely traded across the globe. For ex- [Kilotonnes]
ample, Mitsubishi, LS Nikko, Mitsui, 2017-18 2018-19 2019-20 2020-21 2021-22 2022-23 Q1 FY
etc. sell their material to Southeast 2023-24
Asian markets, including India. Boli-
den and Aurubis in Europe sell mate- Australia 22 7 34 104 18 39 0
rial to North Africa and Latin America. China - 245 310 216 340 417 61
Globally, such trading volumes are Japan 305 494 217 582 458 500 338
around 6-7% only. Korea 379 498 304 839 770 756 349

Philippines 239 234 38 251 283 220 36
As 93% of acid produced globally
is by the sulphur-burning route, this Total 945 1,478 903 1,888 1,851 1,932 784
production route will dictate sulphuric Source: Ministry of Commerce and Industry.
acid prices. Table 6: Sulphuric acid demand and supply in India
[Kilotonnes]
In 2022, Indian smelters output met 2022 2023 2024 2025 2026 2027
20% of Indian acid demand. It is ex- Indian sulphuric 13,400 13,591 15,036 15,297 16,204 16,992
pected that in 2025 Indian smelter out- acid demand
put will grow and meet 27% of the then Indian sulphuric 11,480 12,241 14,588 15,765 16,133 17,072
expected demand. Thus, India is diffe- acid supply
rent from the rest of the globe.
Sulphur burnt acid 9,130 9,466 11,563 11,490 11,858 12,797
There are instances where the Smelter acid 2,350 2,775 3,025 4,275 4,275 4,275
relationship between cost of sulphuric Surplus/(-Deficit) -1,920 -1,350 -448 468 -71 80
acid production from sulphur and Source: Hindalco.
actual prices of sulphuric acid is absent. imported of sulphuric acid, mainly for Zinc] compete with acid produced
In some periods of time, sulphuric acid producing phosphoric acid. Copper and through the sulphur route. The quality
price kept on rising without sulphur zinc smelters from Japan and South of acid generated by Birla Copper is
price climbing. Briefly, imported Korea are the leading exporters to India. well accepted and considered an indus-
sulphuric acid prices were even negative, try benchmark.
meaning sellers were partially reim- Acid prices are governed by sul-
bursing transportation cost to buyers. phur prices and the market opportuni- In 2024, India is expected to import
ties. Smelter acid imported into India less than half of the tonnes it is likely
2025: A turning point? and acid produced by domestic smel- to import in 2023. Going forward,
Traditionally, India has been an ters [viz., Birla Copper and Hindustan India may not require imported sulphuric

Chemical Weekly October 24, 2023 185

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