This year's concentrated nitric acid market has experienced an unusual situation, driven by multiple factors such as rising coal and synthetic ammonia prices, transportation disruptions caused by snow disasters, and reduced supply due to production cuts. Contrary to the typical off-season slowdown, the market has seen a surge in demand and sales, with prices climbing sharply. It is expected that this upward trend will continue in March and April, supported by high production costs and limited supply.
In February, the mainstream price of concentrated nitric acid increased from 1,350–1,400 yuan/ton at the end of 2007 to 1,520–1,580 yuan/ton. Although domestic supplies expanded rapidly in late February, short-term downward pressure on prices was observed. However, as the price of synthetic ammonia rose again and some nitric acid plants reduced output, market prices rebounded. Currently, the average ex-factory price has climbed to 1,600–1,700 yuan/ton.
The peak season for concentrated nitric acid during what should be an off-season is largely attributed to rising production costs. Most Chinese producers use coal as their main raw material, so increasing coal prices have directly pushed up production costs. With the recovery of industrial activity and the approaching spring plowing season, coal supply remains tight, and prices are expected to stay high.
Since November last year, the continuous rise in coal and urea prices has disrupted the supply-demand balance of synthetic ammonia, a key raw material for nitric acid. Although prices dipped slightly before the Spring Festival, they quickly rebounded after the holiday. The domestic price of synthetic ammonia has risen from 2,700–2,800 yuan/ton in late December to 3,150–3,200 yuan/ton, with further increases likely.
Platinum, a major cost factor after ammonia, has also seen a sharp price increase. Due to limited platinum resources, prices have surged over the past year. In March, domestic platinum reached 505–507 yuan/g, while antimony prices hit 2,390–2,410 yuan/g. At the same time, steel prices have also risen significantly, with some products increasing by as much as 20%, leading to higher maintenance and production costs for nitric acid facilities.
The cost pressures for concentrated nitric acid production are not stopping there. According to the National Bureau of Statistics, in January, the purchase price of raw materials and fuels rose by 8.9%, and the ex-factory price of production materials increased by 6.5%. Additionally, since the second half of last year, overall inflation has been rising, pushing up labor and operational costs for nitric acid companies. In February, the national consumer price index rose by 8.7% year-on-year, adding more financial pressure on businesses.
Furthermore, with rising interest rates in China, many businesses involved in the purchase and sale of concentrated nitric acid are facing increased financing costs. To offset these rising expenses, the difference between acceptance bill rates and spot exchange rates needs to increase from 20–30 yuan/ton to 50–60 yuan/ton. These combined factors are shaping a challenging yet highly profitable environment for the concentrated nitric acid industry.
Metal Caps Making,New Easy Open End Making Machine,New Tinplate End Lids Making Machine,New Tin End Making Machine
Zhejiang Golden Eagle Food Machinery Co.,Ltd. , https://www.goldeneaglecanmaking.com