8/4/2010
Tunis, 29/6 – 1/7/2010
By : MEDDEB HAMROUNI TAOUFIK
This presentation of the global sulphur market has the following themes: •Definition of the global sulphur market •Production between 2004 and 2009 •Consumption between 2004 and 2009 p •China market and its imports •Evolution of the monthly posted price FOB/ADNOC •Global export of sulphur in 2007 •New programmed projects •The production expectations during the coming period 2010/2014 •The consumption expectations during the coming period 2010/2014 •Expected balance of supply and demand during the period 2010/2014 •Conclusion •NB: We would like to mention that some statistics were sourced with The approval of IFA and CRU-British Sulphur.
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1 - The global sulphur market:
•
The global sulphur market is one of the most important bulk materials markets in the world with an estimated production in 2009 about 50.2 million tons, the volume of exports, is about 30 million tons, accounting for 60% of the production.
•
oil and gas industry represent the main source of sulphur that gives approximately 99% of the total production, while the mining source represents only about 1,2% of the total quantity and does not exceed 600 thousand tons per year mainly from Poland. The main quantities of sulphur in the world come from five key areas, namely:
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•
I-The North and Central America (America and Canada)
•
The total exports from this region are about 10 million tons per year, mainly to the markets of Latin America, China and South Africa.
• •
II- Caspian Sea region (Russia and Kazakhstan) Exports from this region are estimated at about 6,9 million tons per year, mainly to the Mediterranean Sea (including Tunisia and Morocco) and China (by rail from Kazakhstan).
•
III- region of the Arabian Gulf
•
The total estimated exports of this region is about 7,5 million tons mainly to the markets of China and India, and in part to North Africa and Brazil.
• •
IV - Western Europe The total estimated exports of this region are about two million tons per year, mainly to the E European market, k t Morocco M and d Tunisia. T i i
•
V- The Far East
•
The total exports of this region is estimated at 1,5 million tons per year mainly to the Chinese market and Asia.
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6% 7500mT 15% 23%
5000mT
28%
13%
55% 13%
975mT
3%
41% 2900mT
4%
2200mT
31%
11%
23% 8%
14% 14% 8% 7%
7%
32%
P: C: M:
48,5 MT 49 MT 30 MT
36%
9%
60%
ANNEE 2007
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2 - Production: The following table summarizes the evolution of the global production of sulphur:
Source : British Sulphur Dec 2009 x 1000 T
AMERICA CANADA MEXICO VENEZUELA WESTERN EUROPE POLAND CIS SAUDI ARABIA UAE IRAN KUWAIT QATAR South and East Asia WORLD TOTAL
2004
2005
2006
2007
2008
2009
9390 8270 1000 880 4300 990 8200 2250 1930 1400 680 360 4880 46100
8800 7820 1020 930 4490 990 8590 2700 2000 1470 840 430 5620 47060
8370 7960 1070 985 4635 990 8690 2900 2045 1550 740 440 5930 47820
8280 7615 1020 900 4665 1025 8820 3100 2180 1620 830 500 6295 48550
8540 7000 1040 900 4590 960 9020 3160 1915 1680 810 635 6740 48790
9050 7130 1165 900 4490 600 8920 3300 2120 1750 825 935 7150 50270
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•
This table highlights that the global production of sulphur between 2004 and 2009 is progressing continually during this period with about 4,2 million tons in total, with stability during the years 2007 and 2008 because of the disturbance of the global market during those years.
•
The production development of some countries is as follows:
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•
Kuwait: relative stability about 800 thousand tons.
•
Iran: rise from 1,4 to 1,75 million tons.
•
Saudi Arabia: a continuous evolution from 2,2 to 3,3 million tons (+1,1).
•
UAE: stability of production around 2 million tons.
•
South and East Asia: a continuous large evolution from 4,8 to 7,1 million tons (+2.3) in particular China and India, with the stability of Japan about 2 million tons.
•
Canada: stability around 8 million tons until the year 2006 and decline from 2007 to around 7 million tones due to climatic conditions in 2008 and the volatility of the market during end 2008 and early 2009.
•
America: Unlike Canada Canada, decreases until 2007 and then increasing since 2008 to more than 9 million tons.
•
CIS: small increase from 8,2 to 8,9 million.
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•
3 - Consumption:
•
The sulphur consumption development was as follows:
Source: British Sulphur December 2009 x 1000 T
2004
2005
2006
2007
2008
2009
AMERICA
11800
10720
10185
9800
9900
8750
BRAZIL
2000 3630 480 3525 3250 850 1750 2000 2300 7400 46000
1820 3550 480 3750 3530 850 1675 2120 2500 9100 47370
1900 3395 500 3890 3660 800 1625 2220 2500 9775 47780
2300 3370 500 4150 3500 800 1600 2145 2470 11000 49050
2100 3315 490 4350 2770 870 1500 1845 2300 9600 46865
2000 3300 480 4400 2450 800 1520 1935 2500 13200 46440
EUROPE POLAND CIS MORROCCO SOUTH AFRICA TUNISIA Middle East INDIA CHINA WORLD TOTAL
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The main consumption areas were: •
United States: in a steady decline from 11,8 million tons to about 8,7 in 2009 (decrease by approximately 3 million tons).
•
B il stable Brazil: t bl att about b t 2 million illi ttons.
•
The former Soviet Union: evolution from 3,5 to 4.4 (+0.9).
•
Morocco: decrease significantly during the years 2008 and 2009.
•
South Africa: stable at around 0,8.
•
China: The consumption of this country continues to increase from 7,4 to 11 (+3.6) million tons during 2007, which affected clearly the global sulfur market, p in consumption p in 2008 and then as we will show it later,, and then a slump back with a very high consumption during 2009 for about 13,2 million tons.
•
India: a slight increase from 2,3 to 2,6 million tons.
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4 - the Chinese market and imports: •
The current decade can be considered as the decade of China for sulphur. Imports rise between 2001 and 2009 from 3,3 million tones, which represented only 9% of global production and 17% of the trade market to more than 12 million tones, which represents 26% of world production (compared to 9%) and 37% of the trade market (compared to 17%) as shown in the following table:
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Source: British Sulphur Dec 2009 YEAR
2001
2002
2003
2004
2005
2006
2007
2008
2009
ARAMCO/CHINE
65
30
345
250
605
1 152
1 175
1 460
2 055
Production ARAMCO
2 350
3 300
2 230
2 180
2 250
2 700
2 900
3 100
3 160
Part CHINE sur Prod. ARAMCO 3%
1%
16%
11%
22%
40%
38%
46%
62%
ADNOC/CHINE
310
280
550
495
725
930
1 200
490
695
Production ADNOC
1 490
1 900
1 925
1930
2 000
2 045
2 180
1915
2 120
Part CHINE sur Prod. ADNOC
21%
15%
29%
26%
36%
45%
55%
26%
33%
CANADA/CHINE
1 825
2 480
2 320
3 750
3 960
3 565
2 720
1 825
2 290
Production CANADA
8 200
7 130
8 180
8 070
8 270
7 800
7 960
7 615
7 000
Part CHINE sur Prod. CANADA 22%
30%
29%
45%
51%
45%
36%
26%
32%
Consommation CHINE
3 670
4 300
5 000
7 400
9 100
9 775
11 000
9 600
13 200
Importation CHINE
3 320
4 250
5 290
6 950
8 100
8 650
9 610
8 075
12 170
Production Mondiale
41 400
43 000
44 450
46 100
47 060
47 820
48 550
48 790
50 270
Part cons CHINE % Prod Mond Marché Mondial
9% 19 000
10% 21 780
11% 24 730
16% 26 600
19% 27 800
20% 28 400
23% 30 000
20% 30 000
26% 33 000
20%
21%
26%
29%
30%
32%
27%
37%
Part Imp Chine % Marché Mond 17%
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All analysts believe that this country is still hiding secrets again. Thus, if the consumption and imports continue in China on the same pattern the world market could see an imbalance after 2011 with the entry of new large consumptions in most areas, such as Saudi Arabia (MAADEN) and Morocco in North Africa as well as some African countries for the production of sulfuric acid for metal use. •
China, represents also the natural main market for the most important producers of the Arabian Gulf in addition to India.
•
China represents: 62% of the Saudi Arabia production in 2009 compared to 3% in 2001.
•
33% of the Arab Emirates production, compared to 21% in 2001 and has reached 55% in 2007.
•
The share of Canada in the Chinese market has risen from 22% to 32% in 2009 and has reached 51% in 2005.
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•
All these figures and the previous table shows how China has become the country that tempts the most important producers in the Gulf and Canada. It is also the country with the high demand and can therefore offer better prices compared to other markets.
•
This is what makes the North African market as secondary for the Middle East sources.
•
The following are China's imports during the last three years.
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Source Fertecon 28 January 2010
Country Canada United U it d States St t Kazakhstan Russia Saudi Arabia Iran Arab Emirates Kuwit Qatar Japan South Korea Taiwan Othrers Total
2007 2804 758 414 539 1176 795 1214 172 37 926 266 312 234 9647
2008 2156 369 366 267 1462 691 486 254 368 1047 340 303 306 8415
2009 2290 1300 1115 65 2055 1015 695 457 505 1230 620 395 428 12170
Difference Percent % 08/09 08/09 134 6% 931 252% 749 205% 20276%593 41% 324 47% 209 43% 203 80% 137 37% 183 17% 280 82% 92 30% 122 40% 3755 45%
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This table highlights that the imports of China has increased by 3,8 million tons in 2009 compared to 2008, the figure is very high and affects directly the reality of the global market as this rise resulted from an increase in the supply from all the areas of the world with varying degrees except Russia. •
This situation is suitable for the North African countries which buy a large part of their needs from Russia.
•
It should be noted however, that the rise in China's imports has resulted in the formation of stocks exceeding 2,6 million tons in 2009 up from around one million tons in the beginning of the year. This has enabled the Chinese to make resistance for prices during the negotiations of 2009.
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We note that this inventory was acquired by traders and speculators when prices were relatively high, which explains that they were reluctant to sell this stock if the price level doesn't reach U.S. $ 85 per tone, so the Chinese consumers continued to import which explains the great demand from China during the months of December 2009 and January 2010 instead of consuming the inventory, but this situation has resulted in the increase of prices to more than 180 US$ at present (March 2010).
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5 – The monthly posted price FOB/ADNOC: •
The following g table shows the evolution of the monthly yp posted p price FOB ADNOC which is the most important indicator of the market situation in the Gulf since January 2007:
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SOURCE: FMB
(USD FOB)
2007 2008 2009 2010
January
February
March
April
May
June
July
August
September
October
November
December
54 495 50 110
58 600 35 165
64 640 45 210
87 670 50
100 720 50
120 800 40
150 820 35
180 770 33
200 580 40
220 200 45
240
360 50 57
50
900 800 700 600 500 400 300 200 100 0 December
November
October
September
August
2007
July
2008
June
2009
May
April
March
February
January
2010
Not published because of low price sale
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•
It highlights the evolution of sulfur price FOB ADNOC which reached the historical record (820 U.S. $ per tone) during the month of July 2008 and then begins to decline rapidly to reach during the month of October 2008 the level of October 2007 almost at the start of successive and continuing rises once again decreased back during June 2009 to less than the level of January 2007.
•
The decline continues until August 2009 to reach US$ 33. And then rose gradually during the last months of the year 2009 to reach $ 57 again and then continue to rise during the beginning of 2010.
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6 - Global exports of sulphur in 2007 x 1000 T Exportateurs
Source :IFA
Canada
USA
Mexique Venezuela
France
Allemagne
Italie
Pologne
Hollande
Kazakhstan
30
315
30
15
340
45
145
45
30
Russie
A, Saoudite
Emirats A,U
Koweit
Iran
Qatar
Japon
Autres
TOTAL
125
930
Importateurs
30
Europe de l'ouest Europe Centrale
715
Europe de l'Est l Est
2080
10
105
335
685
5
1405 2925
820
25
Amérique Latine (Autre que Brésil)
260
125
20
65
470
Brésil
830
270
260
75
2220
Maroc
50
120
USA
Tunisie
65 220
180
75
15
20
Sénégal
50 445 110
60
85
345
240
30
150
1400
920
115
250
820
25
20
40
Moyen orient
75
(Egypte, Israel, Liban)
Asie (Hors Inde et Chine)
55
200
990
Inde
2700
Chine
760
Autres
7440 1295
TOTAL
1100
325
70
25
25
925
265
585
485
190
3885
125
145
140
500
Afrique du sud
180
185
25
830
65
115
50
35
60
1680 280
120 35
95
240
10
720
110
1570
240
1745
80
40
190
450
260
280
330
50
70
1750
415
730
1175
1200
220
790
50
930
640
9610
830
1165
500
1220
50
35
65
5
2030
4945
2900
2175
475 30000
NB : Soufre élementaire = Mines + Pétrole + Gaz.
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Global exports of sulphur in 2008 x 1000 T Exportateurs
Source :IFA
Canada
USA
Mexique Venezuela
France
Allemagne
Italie
Pologne
Hollande
Kazakhstan
Russie
Autres
TOTAL
55
255
15
20
360
60
60
175
1030
125
65
35
10
90
1000
225
A, Saoudite
Emirats A,U
Koweit
Iran
Qatar
Japon
Importateurs Europe de l'ouest
30
Europe Centrale Europe de l'Est USA
2160
825
Amérique Latine (Autre que Brésil)
410
400
Brésil
870
340
85
160 25
Maroc Tunisie
30 140
105
75
45
30
(Egypte, Israel, Liban)
935
50
1825
Autres
50
TOTAL
225
1125
705
150
130
110
3060
250
780
90
165
125
110
1795
135
20
Chine
370
6805 1190
30
390
190
120
25
105
20
50
10
95
5
910
260
1200
45
120
25
40
70
40
170
370
1700
25
290
330
215
265
70
60
170
1445
255
690
370
1020
925
8075
600
1250
40
365
265
1465
485
5
20
125
20
5
45
125
95
30
1015
290
720
220
475
2140
3340
3230
1500
435
2255
60
50
Inde
985
90
370
40
40
3070
175 335
525
Moyen orient
Asie (Hors Inde et Chine)
75
15
Sénégal Afrique du sud
345 80
325 1225
35 785
1155
555 27725
NB : Soufre élementaire = Mines + Pétrole + Gaz.
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7 - New planned projects : Source British Sulphur Dec 2009 (1000T)
2010
2011
2012
2013
USA
700
500
100
100
E Europe (It (Italie) li )
400
300
200
Uzbekistan+Turkmen
400
A.Saoudite
900
TOTAL 1400 700
Russie Kazakhstan
2014
300
350
150
500
300
300
1100
300 300
700
250
100
1550
400
200
1150
E.A.U
200
350
Qatar
700
500
300
200
200
1900
Chine
500
1300
1600
1000
800
5200
2500
4450
2600
2900
1750
14200
Total Monde
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This table shows the estimated increase in the production with a rate of 2,8 million tons per year. •
Based on these new projects programmed in the main producing countries of sulphur the following expectations are drawn between 2010 and 2014, but they depend on the achievement of all these projects, depending on economic conditions of each country:
•
- A substantial increase is expected in south-east Asia, especially China during this period amounted to 5,2 million tons.
•
- A significant increase as well in Qatar and Saudi Arabia with about 1,9 and 1,5 million respectively, but with the entry of MAADEN on stream the exports from Saudi Arabia may decrease slightly.
•
- Arab Emirates, a significant increase of about 1,1 million tons.
•
- In Kazakhstan also a significant increase by approximately one million tons, but for this country logistical problems remain an important issue with regard to quantities of exports.
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8 - Expectations of global production between 2010 and 2014: From the future programmed projects the following table summarizes the evolution of the global production Source British :Sulphur Dec 2009 (x1000 T)
2010 America Canada Mexico Venezuela Western Europe Poland CIS Saudi Arabia UAE Iran Kuwait Qatar South and East Asia World Total
9760 7165 1225 1000 4935 800 9500 3600 2375 1820 850 1780 7990 54960
2011 10270 7025 1260 1150 5300 340 10100 4430 2630 1890 850 2280 9290 59100
2012 10375 6985 1270 1200 5430 370 10400 4700 2650 1960 850 2560 10900 62100
2013 10480 6845 1280 1250 5470 375 11350 4950 3030 2030 850 2780 11900 65000
2014 10535 6645 1325 1400 5375 380 11720 5075 3525 2100 850 2970 12700 67300
25
This table highlights that the global production of sulfur will continue to increase between 2010 and 2014 with about 3 million tons annually (+5.6%). •
The most important production will be as follows:
•
-Kuwait: the relative stability of around 850 thousand tons.
•
-Iran: I a slight li ht iincrease ffrom 1,8 1 8 to t 2,1 2 1 million illi ttons.
•
-Saudi Arabia: a continuous and important evolution from 3,6 to 5 million tons (+1.4).
•
-UAE: continuous evolution as well from 2,4 to 3,5 million tons (+1,1)
•
- America: a continuous relative evolution from 9,7 to 10,5 million tons (+0.8).
•
-CIS: This region will see as well a significant development in production in Kazakhstan and Turkmenistan,, while Russia remains about the same level and the total CIS will increase from 9,5 to 11,7 million (+2.2).
•
-Canada: Unlike almost all other countries, Canada will see a decline in production.
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9 - Expectations of global consumption between 2010- 2014: The forecast for the global consumption will be as follows:
Sourc British Sulphur Dec 2009 (x 100 T)
2010 America Brazil Europe Poland CIS Morocco South Africa T i i Tunisia Middle East India China World Total
9400 2100 3400 470 4700 2775 740 1670 2000 2500 12500 49860
2011 9450 2150 3415 450 5000 3200 740 1970 2650 2500 13000 52700
2012 9950 2300 3340 450 5200 3230 740 2030 3390 2500 13500 55500
2013
2014
10050 2450 3300 450 5500 3230 740 2030 3945 2500 14000 58300
10050 2700 3300 450 5600 3230 740 2030 4220 2500 14500 60400
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•
The global consumption is expected to increase from 49.8 to 60.5 (+10.7) million tons with a ratio of 2,7 million tons annually (+5.4%).
•
The most important areas of consumption will be as follows:
•
United States: a slight increase from 9,4 to 10 million tonnes (+0.6)
•
Brazil: increase as well from 2,1 2 1 to 2,7 2 7 million tons (+0 (+0.6) 6)
•
The former Soviet Union: evolution from 4,7 to 5,6 million tons (+0.9).
•
South Africa: stable at approximately 0,7 million tons.
•
Middle East: a significant increase from 2 million to 4,2 million, more than doubled due to the coming on stream of MAADEN in Saudi Arabia.
•
China: is expected to continue its consumption and will remain the main driver of the global market, with a consumption increasing from 12,5 to 14,5 (+2) million tons.
•
India: stability in the level of 2,5 million tons.
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10 – Expected balance of supply and demand
It is expected that the balance of the market will be as follows:
29
Source British Sulphur Dec 2009 (x1000 T)
2004
Year
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
Production
46100 47060 47820 48550 48790 50270 54960 59100 62100 65000 67300
Consumption
46000 47370 47780 49050 46865 46440 49860 52700 55500 58300 60400
Balance
100
310-
40
500-
1925
3830
5100
6400
6600
6700
6900 70000
60000
Production 50000
Consumption
40000 2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
Balance 8000 7000 6000 5000 4000 Balance 3000 2000 1000 0 2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
-1000
30
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CONCLUSION •A growing demand in China •Reduced production in Canada •Delay of the projects in most regions during the previous period because of the economic crisis. Climatic difficulties in the Black Sea (Russia (Russia, Kazakhstan) and the Baltic Sea (Russia •Climatic Ustluga) and Vancouver. •Booming global economy and the global fertilizer market during the beginning of the year 2010. •All these elements and high prices may lead to imbalance between supply and demand for a new bubble during 2010 !!!! •On the other hand the global economic recovery could lead to the completion of most of the new projects and there will be an over supply and than prices will decrease again!!! •Moreover, M th the other th ffundamentals d t l lik like price i off grain, i crops,…and d ffuell did didn’t ’t iincrease so much, so that we can consider this small bubble as conjonctural which will disappear soon !!!! •This is our destiny in the global fertilizer market which remains always dynamic and exciting!!!
Thank you for your attention 31
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