Sulfur markets

Agriculture is the largest industry for sulfur consumption. Historically, the production of phosphate fertilizers has driven the sulfur market. Phosphate fertilizers account for approximately 60% of the sulfur consumed globally. Thus, although sulfur is an important plant nutrient in itself, its greatest use in the fertilizer industry is as sulfuric acid, which is needed to break down the chemical and physical stmcture of phosphate rock to make the phosphate content more available to plant life. Other mineral acids, as well as high temperatures, also have the abiUty to achieve this result. Because of market price and availabiUty, sulfuric acid is the most economic method. About 90% of sulfur used in the fertilizer industry is for the production of phosphate fertilizers. Based on this technology, the phosphate fertilizer industry is expected to continue to depend on sulfur and sulfuric acid as a raw material. 

R. A. Belbutowski, paper at Sulfur Markets Symposium, Sulfur Institute, Washington, D.C., Mar. 24, 1994. 

The present paper is based on the author s study (1) funded by the U. S. Bureau of Mines which, however, is not responsible for the views expressed or the conclusions reached. The time element has been subdivided into three discrete points and a period. The points include current output levels, for use as a base line, 1985 and 1990. The period encompasses the decade from 1990. This reflects the increasing unreliability of the estimates as the projection is extended. Because sulfur markets tend to be discrete and sulfur sources tend to be geographically differentiated regional supply projections are required. The definition chosen here is the Petroleum Administration for Defense districts. [These are defined as I - Connecticut, Delaware, District of Columbia, Florida, Georgia, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, North Carolina, Pennsylvania, Rhode Island, South Carolina, Vermont, Virginia, and West Virginia. II - Illinois, Indiana, Iowa, Kansas, Kentucky, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, Oklahoma, South Dakota, Tennessee, and Wisconsin. 

These new developments of high H2S natural gas come at a time when the world sulfur market is particularly bouyant, sufficiently... 

The distribution of sulfur markets for 1979 are displayed in Figure 1. Sulfuric acid is the most important product derived from sulfur. About 84 percent of the sulfur consumed was either converted to sulfuric acid or produced directly in this form. 

With the advent of new uses for sulfur in the near future, there is no present evidence that by-product sulfur from synthetic fuel plants will swamp the sulfur market in this century. If Frasch production still continues to decline the new markets continue to develop, sulfut imports may still be required in the year 2000. 

Until the 1960 s, the majority of the world s sulfur supply was the direct result of the voluntary sulfur producers. However, the advent of sour gas production in Alberta, Canada in the 1960 s resulted in the dumping of tremendous quantities of involuntary sulfur into the world marketplace. By 1968, a serious oversupply developed, sulfur prices were weakened, and a retrenchment in the fertilizer sector occured. This led to a general collapse of the sulfur market, which continued through most of 1973. 

By 1975, the sulfur market had become very tight in regards to supply and demand. Sulfur prices rose steadily as a result of the decline in involuntary sulfur production, the increase in Frasch production costs, logistic supply problems, an expansion in fertilizer manufacturing, and the ability of the fertilizer industry to pass increased sulfur prices on to their consumers. 

Source Con-Sul, Inc. and Freeport Sulfur Marketing Department estimates. 

In the natural gas business, acid gas injection has quickly become the method of choice for the disposal of such gases. Larger producers are also considering injection because of the volatility of the sulfur markets. 

At the end of World War I, the Frasch sulfur industry in the United - States had grown to the point where it could seek a share of the world sulfur market. Until the advent of World War II, it was the source of most of the worlds sulfur and provided a dependable supply of this vital commodity for the sulfur-consuming industries. 

With the unification of Italy, the government began to provide consistent regulation across the country. For the mining industry, in which sulfur was a major part, the body responsible for this task was the Consiglio e Corpo Reale delle Miniere, formed in 1865. Sulfur markets continued to grow. In 1868, 184,000 tonnes of sulfur were shipped from Sicily, valued at 1.5 million. 

Sulfuric acid demand surged ahead at astronomic rates, but no new plants in Europe were using elemental sulfur. All new plants were on pyrites, and the established facilities switched in the following decades. By 1880, the elemental sulfur market in Europe for the manufacture of sulfuric acid had disappeared The resilient demand for sulfur, though, was almost oblivious to these changes and continued to surge ahead. By the mid-1880 s, Sicilian exports had double in two decades to 350,000 tonnes. 

Adding to their woes, the largest sulfur market, the manufacture of sulfuric acid, had disappeared in the U.S. When Frasch had filed his patent over 80% of the rapidly growing American sulfuric acid industry used elemental sulfur as its raw material. By 1901, 85% of the industry had switched to pyrites. The only major acid producers using elemental sulfur were Kalbfleisch (later purchased by Cyanamid in 1929) and Grasselli Chemical Company of Cleveland. Most of the sales of Union Sulfur had been through Petit Parsons in New York City for resale. Other shipments were made to a sulfite pulp mill in Wisconsin and fertilizer manufacturer in Meridian, MS. 

In 1987, Shell discovered the massive Caroline sour gas field (H2S = 25%). Construction of the sulfur recovery plant began in October 1990, and the plant opened in March 1993, just as the sulfur market was falling. Caroline is the largest... 

Before Canada had produced one tonne of recovered sulfur, the U.S. was already the largest producer in the world, reaching 140,000 tonnes in the U.S. in 1950 and surpassing 500,000 tonnes, seven years later. Most recovered sulfur in the U.S. came from oil refineries. By the end of the 1950 s, recovered sulfur producers were begitming to impact traditional Frasch sulfur markets. The one-millionth tonne milestone for recovered sulfur from oil and natural gas was reached in 1964. By 1970, there were almost one hundred producing sites across twenty-three states five companies accounted for over 40% of the recovered sulfur production in the U.S. (see Table 5.3). 

The problem was that demand was fickle and production, oblivious to sulfur markets, just kept on increasing. There was some movement among Frasch producers. With the lower price, many Frasch mines in the U.S. closed. In 1971, the number was down to thirteen. While there was a major decline in the number of U.S. Frasch mines, there was only a nominal impact on production as the closures were generally smaller mines. Over 70% of the production came from the five largest mines. 

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