Four Big Disadvantages of Compound Fertilizer Market in China

Since July compound fertilizer prices sharply lower, the drop in June of 150 ~ 200 yuan (tons of price, the same below), it’s this year’s biggest falls for a time. At present, the mainstream ex-factory price of 45% chlorine based general compound fertilizer in domestic is 2000-2200 yuan, the mainstream ex-factory price of 45% s-based compound fertilizer is 2300-2500 yuan. According to the analysis, although the range of price drop of compound fertilizer is not big, the market outlook is still not optimistic, there are four major disadvantage.

One disadvantage is the poor market mentality. August already entered autumn winter wheat fertilizer prepared peak season, but this autumn seems to be very cold and cheerless, because fertilizer prices is all the way down, farmers and traders are generally cautious, prepared fertilizer time delayed again and again.

The second disadvantage is the price of potash fertilizer could greatly lower. On July 30, Russian urals potash corp. announced his retirement from the BPC alliance, and 500000 tons of supply agreement with China. This may lead to global potash prices fall from $400 to below the $300. Look from the cost factor, the prices of nitrogen and phosphorus are basic to a minimum content, only the potassic fertilizer factor is uncertain. If contract price of potassic fertilizer fall is bigger, the compound fertilizer prices will be the next step.

The third disadvantage is the shock of diammonium phosphate. The FOB price of 64% diammonium phosphate in China from $450 to $455 in early July, has dropped to the current $433 to $435, and lower the domestic price of diammonium phosphate. the ex-factory price of 64% diammonium phosphate in domestic market fall is expected to drop to 2400-2500 yuan. The price of diammonium phosphate is low and likely to have impact on compound fertilizer market. Some farmers may switch to diammonium phosphate instead of the compound fertilizer.

The forth disadvantage is the downturn of compound fertilizer export. Chemical fertilizer export policy is easing this year, its response has advantage of fertilizer export, but due to the sluggish of international market, chemical fertilizer export is blocked in China. A large number of nitrogen and phosphorus binary compound fertilizer export could activate the domestic market previous, and now the former star varieties were over the hill.

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