6,700 yuan per ton. That was the transaction price for granular sulfur at Zhanjiang Port at the end of April 2026, up 8% month-on-month and over 80% year-to-date. Sulfuric acid prices followed, with no near-term relief expected due to concentrated maintenance shutdowns. At this intensity of raw material cost escalation, the profit structure of the entire phosphate chemical chain is being redefined.
Cost Side: Dual Supply-Demand Squeeze Makes High Prices the Norm
This sulfur surge is no isolated event. Geopolitical conflicts continue to tighten upstream supply, while demand from new energy sectors like nickel hydrometallurgy is growing. Both sides are pushing sulfur prices to historic highs. For phosphate chemical producers relying on mainstream sulfur-burning acid technology, production costs have been directly lifted. Chuanheng Co. admitted that even with pyrite acid production capacity, soaring sulfur prices have significantly dragged down overall costs.
Sulfuric acid markets face similar pressure. High sulfur prices provide rigid cost support, while concentrated maintenance shutdowns in May-June further tighten supply. Industry data indicates that sulfuric acid prices are unlikely to fall sharply in the short term, with high levels becoming the norm. This means the cost pressure on the phosphate fertilizer chain is not a temporary fluctuation but a structural challenge with staying power.
Enterprise Response: Self-Sufficiency Rate and Product Mix as Key Differentiators
Leading firms are not waiting passively. Xinyangfeng's strategy is representative: its 1 million-ton pyrite acid capacity completely avoids sulfur price volatility, while its 3 million-ton sulfur-burning capacity leverages fertilizer supply guarantees to secure low-cost sulfur quotas. More importantly, Xinyangfeng is increasing the share of new-type fertilizers—products less sensitive to raw material prices, helping maintain gross margins through cycles. Once sulfur prices fall, its margin recovery potential will be substantial.
Yuntianhua has taken a different path: relying on ample sulfur strategic inventories to build a cost advantage. It is also optimizing international procurement and increasing purchases of smelter acid from Yunnan, diversifying supply to share the high-price burden. Running at full capacity itself is an effective hedge—spreading fixed costs and maintaining cash flow.
Xingfa Group leverages its full-chain synergy to push up prices of glyphosate and silicones, ensuring cost pass-through. But more notable is its technology bet: a phosphogypsum calcination project for sulfuric acid and cement, expected to start production in 2027, with annual capacity of 800,000 tons of acid and consumption of 2 million tons of phosphogypsum. This is both a cost-cutting move and an industrial upgrade in solid waste utilization.
Technology Breakthrough: Economic Window Opens for Phosphogypsum-Based Acid
China's high dependence on imported sulfur makes prices vulnerable to international disruptions. At a 2026 mid-year sulfur industry meeting, the China Phosphate Compound Fertilizer Industry Association set a goal to reduce sulfur import dependence to below 30%. The current high sulfur price has opened an economic window for phosphogypsum-based acid technology.
Guizhou Phosphate Group's '1468' project is running stably, consuming 1.4 million tons of phosphogypsum annually and producing 600,000 tons of sulfuric acid, leading the industry in sulfur recovery. Chuanheng has postponed its 400,000-ton sulfur-burning project, accelerating feasibility studies on phosphogypsum acid, while building new pyrite acid units in Guizhou and Guangxi, expected to start in mid-2027, with total capacity of 900,000 tons per year, saving about 500 yuan per ton.
These technology routes are accelerating, meaning the industry is shifting from passively absorbing raw material volatility to actively building a diversified supply system. The higher the sulfur price, the more economical alternative routes become, and the stronger the impetus for technological iteration.
Industry Outlook: Cost Pressure Forces Self-Reliance
In the medium to long term, high sulfur and sulfuric acid prices are likely to persist. But the deeper impact of this raw material surge is not short-term profit erosion—it is the acceleration of technological iteration and supply chain restructuring. From phosphogypsum acid to pyrite acid, from strategic reserves to procurement optimization, the industry is building a secure, green, and stable sulfur resource system.
Enhanced chain resilience and anti-cycle capability will push the industry from cost pressure to self-reliance. When multi-source acid technologies are scaled and strategic reserve systems mature, the phosphate chemical industry will no longer be held hostage by sulfur prices—this is the greatest value left by the current cost crisis.