QatarEnergy has announced a complete halt to sulfur production.
The company’s production capacity was approximately 3.8 million tonnes per year, and exports in 2025 reached 3.4 million tonnes — accounting for about 8% of global seaborne supply.
Production was suspended following Iranian drone strikes on facilities in Ras Laffan and Mesaieed
China Domestic market:
Market analysis for today.
The current domestic urea market situation is characterized by a stalemate with weak performance. Most enterprise quotes remain stable, but the market is influenced by sentiment, resulting in relatively limited trading activity. Unless there are any unforeseen events, it is likely that enterprise prices will experience a slight fluctuation within the next week or ten days. However, given the presence of market essential needs, the overall trend may still be one of volatility.
For export, indications now at about 560-590fob for prills and 590-620fob for granulars. No more quotas can be export but indications just follow the rocket up worldwide level increased. Before the conflict, most of the players are waiting for the export quota can be start in April or May, but now if the worldwide level keep increasing and at high levels, export policy may keep strictly for more times. Only if the market back to normal, then we can see the export restart, just like the policy become more strictly in the first of 2022.
Morning. Nola Urea dominated activity again y'day as further gains seen – MAR phys/paper traded up to $610 (+$55 from Mon close), before values slipped nearer to $595-90, while APR paper repeat traded $580 (+$60). On Int'l paper, mkts/offers remained thin amidst geopolitical uncertainty, but Mar Brazil found value $562cfr.
AG
Mar $575//$630
Apr $530 bid
cfr Brazil
Mar $550//$610 – traded $562 (3k)
Apr $515 Bid
Egypt
Phys sales up to $625 (+$130/t from Sat)
Nola
Phys: Prompt traded $585, $595; Mar $600, $610. Lh Mar/Fh Apr $590, $595
Paper:
Mar $575//$590 – traded $610
Apr$565//$590 – traded $585, $580s
May $485//$515 – traded $500, $505
Brazil Amsul
Mar $225//$250
UAN Nola
Mar $375//$390 – $380, $385
Apr $375//$395
May $350//$385
DAP Nola
Phys: Mar traded $655
Mar $650//$665 – traded $647, $660
Apr $640//$655
MAP Brazil
Mar $735/$760
Apr $730//$760
Brussels has refused to suspend CBAM for fertilisers despite pressure from hydrogen and ammonia lobbies, arguing policy stability is critical for clean investment.
Instead, the Commission will temporarily lift certain import duties on ammonia and urea to cushion farmers from higher carbon-linked costs.
The European Commission has rejected calls to suspend the Carbon Border Adjustment Mechanism (CBAM) for fertiliser imports, despite lobbying from hydrogen producers, ammonia developers and several EU member states. Climate Commissioner Wopke Hoekstra confirmed that fertilisers will remain within the CBAM framework, maintaining a carbon price on imported goods equivalent to that faced by EU producers under the bloc’s emissions trading system. The decision preserves CBAM’s scope across hydrogen, electricity, fertilisers, aluminium, iron and steel, and cement.
Since CBAM’s entry into force, some governments have urged Brussels to exempt fertilisers, warning that additional carbon costs could push up prices for farmers. At the same time, hydrogen and ammonia industry groups cautioned that suspending the mechanism would inject uncertainty into investment decisions for blue and green hydrogen-based fertiliser projects. Hoekstra pushed back against suspension proposals, saying, “Any talk of potentially suspending CBMA only creates uncertainty for the fertiliser industry, which prolongs our reliance on imports from countries such as Russia. It puts new investment opportunities at risk, undermining future growth and development.”
Acknowledging that CBAM will add price pressure, the Commission has proposed a parallel measure: temporarily suspending remaining Most-Favoured-Nation tariffs on ammonia, urea and certain other fertilisers. “We proposed a duty relief, temporarily suspending the remaining Most-Favoured-Nation tariffs on ammonia, urea and certain other fertilisers. These measures will help to offset the impact of CBAM,” Hoekstra said. “This is a win-win for European farmers and industry alike.” The compromise maintains the carbon-pricing signal for long-term decarbonisation while offering short-term cost relief.
The clarity may stabilise investment decisions that had stalled during the debate. Fertiliser producer Yara recently warned that policy uncertainty was clouding deliberations over its participation in Air Products’ large-scale blue hydrogen and ammonia project in Louisiana.
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As of March 4, 2026, the total inventory of China’s urea enterprises stood at 1.0981 million tons, a decrease of 77,900 tons from the previous cycle, representing a decrease of 6.62% month-on-month. During this cycle, urea enterprise inventory showed a decline. As the Spring Festival break ended, logistics shipments gradually resumed, parts of the downstream industry resumed operations, and local agricultural demand persisted, which facilitated an increase in the output volume of urea plants. However, with many regions in the north experiencing cold, snowy weather in recent days, the market has become stagnant, and local output volumes have decreased. The provinces with increased enterprise inventory include Anhui, Gansu, Hainan, Hebei, Heilongjiang, Liaoning. The provinces with decreased enterprise inventory include Henan, Hubei, Jiangsu, Jiangxi, Inner Mongolia, Ningxia, Qinghai, Shandong, Shanxi.
Shaanxi
Sichuan, Xinjiang.
China Fertilizer Industry Chain Morning Reference 2026-03-04
❤ Urea: Most enterprises currently face no pressure on shipments. However, due to guidance price restrictions, urea quotations largely remain stable. Individual companies might slightly adjust prices to encourage order collection. While rigid market demand is rising, there is a lack of forward expectations; trading activity and prices are mostly fluctuating based on market sentiment.
❤ Synthetic Ammonia: Yesterday, the synthetic ammonia market saw steady consolidation. Overall demand is insufficient, and downstream operating rates are slow. Affected by smoggy weather, transportation is restricted in some areas, and low-priced sources remain in the market. Meanwhile, some ammonia enterprises have reduced production. In the short term, the market is observing and consolidating while actively shipping. It is expected that the synthetic ammonia market will run firmly.
❤ Ammonium Sulfate: Yesterday, the ammonium sulfate market rose actively. Guided by international sentiment, auction enthusiasm was high, leading to a significant price increase. It is expected that domestic ammonium sulfate prices will actively follow suit this week. As the market is heavily influenced by sentiment, attention should be paid to bidding activities in major production areas.
❤ Ammonium Chloride: Yesterday, the transaction focus of the domestic ammonium chloride market continued to move upward. Some combined alkali enterprises further raised their quotations, and most companies are reluctant to sell, controlling their orders. Downstream inquiry atmosphere remains strong. Current transactions are primarily fulfilling previous pending orders. With no inventory pressure and robust demand, ammonium chloride enterprises maintain their intention to hold prices firm and seek further increases.
❤ Melamine: Yesterday, the melamine market rose steadily. Recently, the growth in melamine supply has been slow, and raw material prices remain high; these dual factors continue to support the market trend. A few enterprises have temporarily stopped taking orders. However, considering the overall demand situation, the market is expected to remain stable with a wait-and-see approach in the short term.
❤ Potash: The domestic potash market trend is relatively flat. With key potash enterprises continuously releasing stock, market inquiries and procurement are somewhat slow, consisting mainly of small orders. Currently, the price of Laotian white potash is mostly between 3,050–3,380 RMB/ton, with transaction prices negotiated individually. Operating rates for potassium sulfate manufacturers remain low, and the overall supply of goods is slightly tight.
❤ Phosphorus Fertilizer: Yesterday, sulfur (a raw material for MAP) continued to rise at high levels, pushing costs upward. Factories and traders mainly continued to suspend orders and quotations. Some 55% powder ex-factory prices in Central China were reported at 3,900–3,920 RMB/ton. Supported by high costs, pending orders, and existing downstream rigid demand, the market is expected to remain firm and trend upward in the short term.
Yesterday, the domestic DAP market saw consolidation. As geopolitical conflicts continue to escalate, sulfur prices continued to surge, placing sustained pressure on the cost side. Demand is following up slowly, with downstream buyers generally maintaining a purchase-as-needed rhythm. Overall, a wait-and-see sentiment prevails, and the market is expected to continue its consolidation trend in the short term.
❤ Compound Fertilizer: Yesterday, the domestic compound fertilizer market continued its narrow range consolidation. Currently, rising raw material prices are driving up costs, leading to a strong intention among enterprises to hold prices firm. Furthermore, as spring demand is released, high prices are gradually being passed down under demand support. In the short term, the compound fertilizer market is performing firmly.
LONDON (ICIS)–Egypt’s Mopco sells 5,000 tonnes of granular urea at $620/tonne for March loading.
Middle East Update
Security conditions in the Strait of Hormuz remain elevated following recent UKMTO reports of military activity and vessels struck by projectiles in the Gulf of Oman and off the UAE. Market intelligence suggests a significant slowdown in tanker movements, with many crude and product carriers delaying transit or holding position pending clarity on security and insurance exposure.
Visibility on dry bulk remains more limited. However, based on vessel tracking data we have identified 32 commercial vessels transiting between 0000UTC 01 March and 0600UTC 02 March, comprising 25 eastbound and 7 westbound movements. The sample includes 9 bulk carriers, 8 tankers or gas carriers, 6 general cargo vessels, 3 fully cellular containerships, and 6 other vessel types.
Some vessels appear to have reduced or temporarily switched off AIS during passage, contributing to patchy tracking and uncertainty around overall volumes.
In parallel, several International Group P&I Clubs including Gard, Skuld, NorthStandard, American Club and London P&I have issued notices in respect of certain war risks covers for the region, mainly withdrawing existing coverage from 5th March. While procedural, these allow underwriters to reassess terms and pricing, and additional war risk premiums are firming.
From discussions with a broad cross section of owners, the prevailing stance is defensive. Owners are not entertaining fresh exposure to anything in the region at the moment, preferring to wait for greater clarity before committing vessels. Some owners are even widening their avoidance radius beyond the Strait itself, including reluctance to position tonnage in the West Coast India region given the proximity and escalation risk.
The opening of a new conflict in the Middle East will likely lead to increased sulphur pricing – and comes just days after global sulphur costs finally started to decline.
Offer prices in Indonesia, the Mediterranean and India were all slipping late last week as buyers stepped back from purchasing amid expectations of further declines.
There was some debate if these declines represented a correction from previously inflated levels, or were simply the result of China – the world’s largest sulphur importer – only just returning from Lunar New Year holidays.
This is likely a moot point now, however, after the US-Israel attacks on Iran.
Middle Eastern nations are key players on the global sulphur stage, and monthly prices set by Kuwait Petroleum Corporation (KPC), the UAE’s Abu Dhabi National Oil Company (ADNOC), and Qatar Chemical and Petrochemical Marketing and Distribution Company (Muntajat), are bellwethers for the world’s trade of the product.
Iran itself is the world’s sixth-largest exporter of sulphur:
Top-10 global sulphur exporters December-November 2022/2023-2024/2025 (tonnes)
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In February KPC, ADNOC and Muntajat posted prices at $520–530/tonne FOB (free on board), the highest level recorded since ICIS began tracking the market in 2017, surpassing the previous peak reached in January – although the month-on-month increase was seen as conservative compared to the recent past.
This was being viewed as indicative of the cycle turning, as buyers increasingly found sulphur prohibitively expensive while demand was low amid a slowdown in market activity, and the turnaround of several fertilizer plants in India.
Indeed, multiple sources discussed lower Middle East and Vancouver FOB bid/offer ranges late last week, all of which were in decline on lengthening availability and the absence of China.
Now, the start of a new conflict in the Middle East – and the widespread impact on freight costs, insurance, and logistics affecting sulphur and many other downstream fertilizer and chemicals products – may arrest this decline, and possibly lead to an uptick once again.
“It’s crazy,” one sulphur trader said, adding: “In the fog of war I don’t think anyone can predict anything at this stage.”
The world was finally getting to grips with Russia’s absence from the global sulphur export market – following war-related damage to its oil facilities – and now the outbreak of this conflict adds new and unpredictable factors to the trade.
Top-10 global sulphur importers December-November 2022/2023-2024/2025 (tonnes)
The longer the war drags on, the more instability we shall see, however need to look at it from a wider perspective
Europe is already refusing to pay these prices and any increase would mean they either don’t buy or swap to nitrates
Europe does not take in AG Mts, so supply disruption may not be affected as badly
End of th season in northern hemisphere
India will Be the biggest loser as its dependent on AG Mts
Markets emerging to buy like Australia will look to buy regionally ie Brunei Malaysia Indonesia
USA just sourced a Vietnamese cargo and can take Russian
Brazil (usually big buyers of Iranian, will be affected but can take in Russian, Venezuelan, Bolivian, Nigerian
Other Iranian dependent countries like turkey will be effected so they will have to compete with Egyptians
China will definitely capitalise on this market increase so they come back for export in 8 weeks time….
So the question is : now all those with shorts have covered in, which country would be prepared to pay at these levels?
I get that suppliers will take advantage whilst this war is on until China appears, but how high before we get demand destruction
In June 2025, IFA’s Market Intelligence Service highlighted the concentration of fertilizer export flows in the Middle East and the potential risks associated with restricted access through key maritime routes. Recent events around the Strait of Hormuz further underline the risk to global fertilizer markets, particularly for significant volumes of nitrogen and phosphate fertilizers.
Five major fertilizer exporting countries – Iran, Qatar, Saudi Arabia, United Arab Emirates, and Bahrain – rely on the strait to transit exports to international markets. Collectively, in 2024, these five countries accounted for:
• 23% of global ammonia trade
• 34% of global urea trade
• 18% of global MAP+DAP trade
The wider Middle East region accounts for almost 30% of global export supply of major nitrogen, phosphate, and potash fertilizers. The weekend developments in the Strait of Hormuz, combined with ongoing risks in the Red Sea, now expose a substantial portion of global fertilizer supply to two trade chokepoints experiencing disruption.
Urea remains the most exposed fertilizer product. In 2024, 18.5 Mt of urea were exported via the Strait of Hormuz, and nearly 50% of global urea trade originated in the Middle East during the same period. Neighboring producers such as Egypt also face feedstock supply risks, mirroring disruptions observed in June 2025.
With natural gas representing 80-90% of ammonia production costs, the region’s role in global gas supply is a critical factor for nitrogen economics, and with almost 50% of global sulphur flows passing through the strait, phosphate fertilizer raw materials are also impacted. Disruption to oil and gas trade flows through the Strait of Hormuz could therefore generate broader ripple effects across the fertilizer supply chain.
[Urea] On March 3, the daily production of the urea industry was 222,700 tons, an increase of 13,000 tons from the previous working day; compared to the same period last year, it increased by 20,900 tons. The current operating rate is 94.57%, up 4.88% from 89.69% last year.
Morning. As conflict in M.East continues, Urea prices firmed up further y'day: Int'l paper saw sellers cautious, while Mar/Apr Nola Phys surged $50+ from Sat on an active trading day. On DAP, Mar/Apr found value $640-45 range. Mkts framed:
AG
Mar $520//$560
Apr $520 bid
cfr Brazil
Mar $495 Bid
Apr $485 Bid
Egypt
Phys sales up to $555 (+$60 from Sat)
Nola
Phys: Prompt traded $550; Mar $550-555; Lh Mar $520-$550; LH Mar/FH Apr $550; FH April $532-$540; Full Apr $535
Paper:
Mar $545//$560
Apr$520//$535 – traded $500, $520
May $425//$480
Brazil Amsul
Mar $220//$240
UAN Nola
Mar $340//$365
Apr $340//$360
May $335//$360
DAP Nola
Phys: Mar traded $640s, $643-45
Mar $642//$647 – traded $645
Apr $635//$645 – traded $640
MAP Brazil
Mar $730/$750
Apr $725//$750