With both costs and demand rising simultaneously, the trace element market requires continued advancement

The demand side saw a recovery this week. While ferrous sulfate retreated by 150 per ton due to high inventories, zinc salts, manganese salts and copper sulfate prices stabilized across the board. In terms of different products:

Zinc Sulfate Monohydrate: Stronger cost support and recovering demand create upward price expectations.

Key market drivers: Resumption of production at individual manufacturers lifts operating rates, yet major producers continue output control, keeping overall capacity utilization low at 41%. Driven by tightened supply and rising costs, prices have room to move up.

Raw materials: Sulfuric acid prices vary by region: North China and Shandong quote 1550–1750 yuan/ton (↓100); Guangxi 1730–1950 yuan/ton (flat); Hunan 1900–2100 yuan/ton (flat). High-grade secondary zinc oxide supply remains tight with high trading coefficients.

Demand: Domestic demand improves. The feed sector benefits from cooler weather, higher feed intake and improved demand for meat, eggs and milk. For fertilizers, rigid demand from major groups stays steady, and special fertilizer production starts in some regions. On the export side, South America freight rates rose 17–23% week-on-week. Buyers mainly fulfill existing contracts with limited new orders.

Manganese Sulfate Monohydrate: Sustained robust exports plus maintenance at major manufacturers keep prices firm.

Key market drivers: Overseas manganese sulfate producers continue halting production due to high energy costs, shifting part of export demand to China. Export orders remain strong, with production schedules booked through the end of September. Maintenance at major producers combined with stable high raw material costs jointly underpin firm prices.

Raw materials: Sulfuric acid prices in core producing regions Hunan and Guangxi remain stable, and manganese ore prices stay elevated, keeping overall raw material costs firm.

Demand: Exports act as the primary driving force at present with tight order backlogs. Domestically, feed demand sees moderate recovery; only special fertilizers and large fertilizer groups offer support for fertilizer demand with limited incremental growth.

Ferrous Sulfate: Persistent inventory pressure triggers another price decline. Key market drivers: Despite substantial production cuts by manufacturers, previously accumulated high inventory is being digested slowly. Supply-demand pressure remains unresolved, and prices fell another 150 yuan per ton this week. Raw material prices remained flat, leading to no notable change in factory costs. To secure orders, some manufacturers are selling at nearly cost price.

Demand: Downstream feed demand improved slightly, yet buyers only make essential purchases with limited new demand. High inventory levels will take time to clear.

Trading recommendation: Manufacturers still need time to reduce inventories. Flexible purchasing is advised based on individual stock levels.