Recently, due to factors such as Russia-Ukraine conflicts, extreme El Niño weather, increased planting area, and new policies in major grain exporting countries, the prices of international fertilizer markets have continued to rise, which has been transmitted to the domestic market, causing prices of urea, phosphate fertilizers, and potash fertilizers to rise. rose to varying degrees. Industry insiders predict that the chemical fertilizer market will fluctuate at a high level in the future as the domestic production capacity of chemical fertilizers and pesticides continues to be abundant and the operation of the agricultural materials market remains stable and orderly.
The urea market is not short in off-season
Recently, the performance of the domestic urea market can be said to be very eye-catching, and there is a situation that the off-season is not weak.
From the perspective of the supply side, after the end of fertilizer use in spring in previous years, agricultural demand has weakened, and the urea market usually has a downward trend. In particular, there will be more than 4 million tons of new urea production capacity put into production this year, which will make the market worse. But the actual situation is: in the first half of the year, the overall urea production increased by only 850,000 tons year-on-year. Considering that the export volume of urea increased by about 290,000 tons year-on-year, this is equivalent to an increase of only 560,000 tons in domestic urea supply in the first half of the year.
From the perspective of the demand side, nearly half of the downstream products of urea are mainly in the agricultural market. At the same time, considering the changes in the fertilizer market this year, as well as the changes in the domestic planting area and crop structure, the demand for agricultural urea is still increasing. , The demand for urea in industrial fields such as vehicles and thermal power has also increased. Compared with the increase in urea supply of only hundreds of thousands of tons, domestic urea supply and demand are still in a tight balance. Secondly, the announcement recently issued by India shows that the export of high-grade rice will be banned due to the increase in rice prices in the country due to the increase in exports. This will have a great impact on the global rice market and will push up food prices. need.
Phosphate fertilizer prices have risen
Urea is the leader of all chemical fertilizers, and the price of urea has risen strongly, which has also given the confidence to increase prices of other chemical fertilizers such as phosphate fertilizers.
In the first half of the year, the domestic supply of nitrogen and potash fertilizers increased year-on-year, but the output of phosphate fertilizers dropped sharply year-on-year, and exports increased significantly year-on-year. According to the data, in the first half of the year, the average market price of 55% powder of domestic phosphate fertilizer monoammonium phosphate was 3034 yuan (ton price, the same below), down 12.73% from the same period last year; the average market price of diammonium phosphate fertilizer (64% content) was 3973 yuan, Compared with the same period last year, it fell by 1.60%.
Xiao Li, an analyst at Zhuo Chuang Information, said that in the first half of the year, the market prices of monoammonium phosphate and diammonium phosphate both appeared at the beginning of the year, continuing the upward trend at the end of last year. Among them, the price of monoammonium phosphate reached 3442 yuan; The market price of diammonium reached 4076 yuan. On the one hand, this is due to the fact that the spring fertilizer preparation in the Northeast market at the beginning of the year is mainly high-phosphate fertilizer, and the demand for monoammonium phosphate and diammonium phosphate is good; Rising ore prices provide some support for the production cost of phosphate fertilizers.
Under the current situation that the operating rate of phosphate fertilizer has increased, the price of sulfur has stopped falling and rebounded; the synthetic ammonia market has also rebounded driven by the price of urea. At the same time, due to the impact of the Chengdu Universiade, some phosphate mines in Sichuan have recently stopped mining, and the output may have decreased. The possibility of a rebound in phosphate rock prices is still increasing. In this context, the prices of the three major raw materials for phosphate fertilizers all have an upward trend, resulting in strong support for the cost of phosphate fertilizers.
Baichuan Yingfu data shows that the market trend of phosphate rock is stable, and the average market price of 30% grade phosphate rock is 853 yuan, which is currently flat. However, market participants reported that the price of phosphate rock in some domestic regions has risen slightly by 50 yuan.
Fertilizer prices fluctuate at a high level
Extreme weather and conflicts between Russia and Ukraine have kept prices of agricultural products at high levels. On the international front, concerns over Ukraine's grain export restrictions triggered sharp fluctuations in US corn and wheat futures prices. Domestically, severe floods occurred in parts of Hebei, Heilongjiang and other places, and crops were flooded, triggering market concerns about reduced corn and wheat production.
Regarding the trend of the chemical fertilizer market in the second half of the year, Zhuo Chuang Information believes that in the second half of the year, the domestic demand for chemical fertilizers is concentrated in autumn preparations and winter reserves, with emphasis on high-phosphate fertilizers, accounting for about 30-40% of the annual demand. In order to avoid the risk of fertilizer preparation, dealers have shortened the fertilizer preparation cycle, and the release of demand will be more concentrated, and the time is locked in August to September and December. In terms of inventory, at the end of July, the domestic inventory of monoammonium phosphate, diammonium phosphate, and urea industries was at a historically low level. The recent rise in the prices of phosphate fertilizers and nitrogen fertilizers has also increased the demand for replenishment in the industry.
Industry insiders predict that the profitability of the chemical fertilizer industry has begun to improve in the near future when the domestic production capacity of chemical fertilizers and pesticides continues to be abundant and the operation of the agricultural material market remains stable and orderly, and the chemical fertilizer market will fluctuate at a high level in the future. (Luo Iowa)
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