After surging 154% in six months, it has nearly halved! What is the impact of sulfur’s extreme fluctuations on the textile chemical industry chain?
In 2026, the sulfur market experienced an extreme cycle of boom and bust. In the first half of the year, driven by geopolitical disruptions, a sharp reduction in imported supply, and concentrated demand from the new energy sector, sulfur underwent a once-in-a-decade super bull market, with prices soaring, significantly raising the costs of upstream chemical raw materials such as sulfuric acid, titanium dioxide, caprolactam, and dyes, and indirectly transmitting along the industrial chain to the textile dyeing and nylon sectors.
In the second half of the year, market dynamics reversed, and prices fell sharply from historical highs, substantially easing cost pressures in the chemical sector and providing an opportunity for cost recovery in downstream synthetic fiber and dyeing industries. However, end-user demand in the textile sector remained weak, and the transmission of cost benefits downward was still hindered.
From a nearly 600% surge in a year and a half to a halving at the peak
The current round of sulfur price increase began in the second half of 2024, driven by supply disruptions in the main production areas of the Middle East, restricted navigation through the Strait of Hormuz, and a significant decline in domestic sulfur import arrivals. Coupled with limited growth in by-products from domestic refining, port inventories continued to decrease. At the same time, new demand from lithium iron phosphate and wet nickel smelting emerged, continuously widening the supply-demand gap and driving prices higher.
At the beginning of 2026, domestic port sulfur was priced at 3,850 RMB/ton. By June 11, granular sulfur at Yangtze River ports surged to 11,750 RMB/ton, representing a six-month maximum increase of 154%, setting a historical high in years. On June 16, the benchmark sulfur price reported by Business Society reached the annual high of 11,050.63 RMB/ton.
However, the market quickly turned; as of November 11, the benchmark sulfur price dropped to 5,151.75 RMB/ton, a decrease of 5,923.44 RMB/ton from the peak, down 53.60%. In the spot market, imported granular sulfur at Yangtze River ports was priced at 5,000‑5,100 RMB/ton, and liquid sulfur from local refineries in Shandong at 5,250‑5,400 RMB/ton, representing a decline of 55%‑57% from the peak.
During the first half of the year, when prices surged dramatically, upstream refining and petrochemical companies saw a substantial boom in profits. Refining and petrochemical enterprises such as Sinopec, PetroChina, and Rongsheng Petrochemical achieved exceptionally high gross margins through by-product sulfur. However, downstream phosphate fertilizer, titanium dioxide, and sulfuric acid companies were trapped in high costs, with some experiencing losses.
On the policy side, since May 1, the Customs authorities have suspended exports of ordinary industrial sulfuric acid to prioritize the supply of domestic industrial and spring plowing raw materials. Industry associations promoted the signing of long-term agreements between upstream and downstream players to guide the industry in coping with raw material crises. As overseas geopolitical risk premiums eased, imported supplies resumed arrival, and high prices suppressed downstream procurement, the market shifted from a situation of scarcity to one of demand-driven purchasing, initiating a rapid correction in sulfur prices.
Chemical‑Textile Industry Chain Transmission
Sulfur, as the core raw material for sulfuric acid, has over 90% of its production used to manufacture sulfuric acid, which is a fundamental raw material for multiple chemical industrial chains, indirectly linking to the textile and chemical fiber sectors.
During periods of rapid sulfur price increases, the cost of sulfuric acid rises in tandem, transmitting downwards to various chemical intermediates related to textiles. The production of caprolactam (the raw material for Nylon 6) is highly dependent on sulfuric acid. During phases of soaring sulfur prices, caprolactam enterprises face significant cost pressures, leading some facilities to reduce output or even shut down, passively raising chip costs.
The dye industry is similarly impacted; some sulfur-based dyes require sulfuric acid in their production, and rising raw material costs squeeze dye manufacturers’ profits, prompting dye prices to increase. This raises processing costs for printing and dyeing enterprises, while downstream fabric and garment order procurement struggles, making it difficult to adjust dyeing fees accordingly.
However, it is worth noting that sulfur does not directly determine the textile market trends. Even in the first half of the year, despite the continued rise in upstream chemical costs, the domestic textile market’s peak season performance fell short of expectations. Orders in the weaving sector were characterized by small batches and quick turnovers. The bargaining power for grey fabrics and finished fabrics was relatively weak, making it difficult for upstream costs to be smoothly passed down to downstream terminals.
This resulted in a situation where ‘raw material prices rise, but finished product prices struggle to increase.’ The pressure from upstream chemical costs was largely absorbed by the midstream chemical, chemical fiber, and dyeing and finishing sectors themselves, with industry chain conflicts continuing to accumulate, according to Global Textile Network.
The titanium dioxide industry is similarly affected by the impact of sulfur. The operating rates of sulfate-process titanium dioxide enterprises declined, and since titanium dioxide is used in coatings and chemical fiber matting agents, it indirectly affects the cost of chemical fiber production auxiliaries, further amplifying the disturbance of the chemical industry chain to the textile sector.
Cost alleviation, but end-user demand remains the core constraint
With the significant decline in the prices of sulfur and sulfuric acid, the costs of the previously suppressed chemical sector have been restored. Phosphate fertilizer, sulfuric acid, and caprolactam enterprises have seen a marked reduction in raw material pressures, and their production facilities are in a position to resume operations; dye enterprises have experienced some relief in raw material cost pressures, and the falling cost of nylon raw material caprolactam theoretically creates a margin space for nylon chips and nylon filament.
However, the benefits are transmitted with a noticeable lag. The overall textile market remains weak; the traditional ‘Silver October’ peak season has ended, downstream weaving operations are maintaining a neutral level, external demand brands still strictly control inventory, and the domestic market lacks explosive pull.
From the supply side, Middle Eastern sources have partially recovered, and sulfur inventories at ports have rebounded from low levels. However, the medium- to long-term global demand for sulfur in the new energy industry remains substantial. Institutional views suggest that sulfur has shifted from being a mere by‑product of oil and gas to a strategic resource.
Overall, sulfur has undergone a rollercoaster run. The shock wave caused by extremely high prices in the first half of the year is gradually being absorbed, alleviating pressure on the indirect textile supply chain, such as for nylon, dyes, and printing and dyeing. However, chemical raw materials are only one external factor affecting the textile industry; the primary determinants of textile market trends remain end-user orders and weaving operations.
For participants in the industrial chain, it is necessary to view this round of correction dialectically and not simply assume that raw material prices will return to the low levels seen years ago. Key points to watch in the market going forward include changes in sulfur import arrivals and port inventories, the resumption of operations in the caprolactam-nylon industrial chain, fluctuations in dye prices, and the delivery rhythm of autumn-winter orders.
Post time: Nov-12-2026
