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The market trend of compound fertilizers first slowly declined and then narrowed down
In 2023, the domestic compound fertilizer market experienced a slow decline and then a narrow consolidation. In July of the year, the price dropped to its lowest point, with 45% sulfur based prices around 2600 yuan/ton and 45% chlorine based prices around 2150 yuan/ton.
In the first quarter, the overall trend of the compound fertilizer market was downward, with raw materials and urea continuing to decline weakly, resulting in a bearish attitude towards compound fertilizer. In addition, the slight decline in monoammonium phosphate and potassium chloride added to the market's wait-and-see sentiment. At the same time, many preferential policies from manufacturers have been introduced, causing a decline in the focus of trading. Starting from February, urea rebounded strongly, promoting an improvement in market sentiment. As the end use of fertilizers approaches, the sales of green manure have significantly accelerated; In addition, in the Northeast region, with an increase in port arrivals, the wait-and-see sentiment has eased. The main compound fertilizer enterprises still focus on fulfilling early orders, and there has been no significant adjustment in price policies. With the shortening of stocking time and the promotion of dealer replenishment, the sinking of compound fertilizer market supply has accelerated, the market atmosphere has improved, and the volume of goods has increased. In March, the cost support for compound fertilizers weakened. In terms of major compound fertilizer enterprises, they are mostly cautious and cautious. However, due to continuous poor shipments and inventory backlog, some profit margins have increased, and dealers lack confidence. In spring, fertilizer replenishment is mostly pushed forward as needed, while in summer, fertilizer operations are postponed. In the Northeast region, there is a general situation of replenishment and release, and companies are experiencing a phenomenon of selling goods.
In the second quarter, the market mainly sold corn fertilizer, with prices continuing to decline. The overall trend of raw materials is not good, and there is insufficient support for the cost and mentality of compound fertilizers. Most of the corn fertilizer in North China has seen significant sales, with prices mainly due to the decline in high-end prices for large enterprises, abundant orders from small and medium-sized enterprises, and limited price adjustments. In the southern region, market sales are generally average, and there are often signs of delayed operations downstream. For its sulfur based products, some clearance prices have been lowered or flexible transactions have been made, with enterprises in Northeast China mainly clearing their inventory, and sporadic transactions have significantly decreased. In terms of raw materials, urea supply is abundant, downstream demand is slow, supply and demand pressure intensifies, and prices continue to decline; The overall trading atmosphere of ammonium nitrate is light, and the factory price is relatively low; Potassium chloride is also weak, with continuous supply of imported goods and negative effects; Its raw materials are weak and difficult to retreat, which continues to constrain the market. Most of the demand in North China is approaching, coupled with delayed stocking in the early stage and an increase in dealers picking up goods and replenishing warehouses, resulting in a significant increase in market sales. Some enterprises have slightly tight supply sources. The minimum guarantee policy for some enterprises has ended, and prices have slightly decreased, resulting in a narrowing of the price difference for corn fertilizer among enterprises. The market mentality in other regions is unstable, with increased transaction flexibility and a focus on single negotiations. Dealers often purchase goods as needed.
In the third quarter, raw material prices fluctuated, but overall showed an upward trend. Due to the export of 1.14 million tons from India, urea prices skyrocketed, potassium fertilizer prices increased significantly, and phosphorus fertilizer prices remained strong. The price of high nitrogen and high phosphorus fertilizers has increased by around 300 yuan/ton. Most large-scale enterprises maintain high prices, and the autumn fertilizer harvest is still good. In July and August, all enterprises started construction, with a significant increase in daily production and a continuous increase in operating rates. As of the end of August, the raw material urea has begun to show a downward trend, the price of phosphate fertilizer has remained strong, and potassium fertilizer has continued to rise. Some compound fertilizer companies have a heavy wait-and-see attitude. By September, autumn shipments are gradually coming to an end, and the daily production of enterprises is gradually decreasing. The market atmosphere is weakening, and a few enterprises in the Northeast region have tentatively introduced winter storage policies and a small amount of advance receipts.
In the fourth quarter, October, and autumn, the market has basically ended, while the winter storage market has not yet fully opened, and the market has entered a phased off-season. The price of urea fluctuates, while the price of phosphate fertilizer has been continuously increasing due to restrictions on the production of raw materials such as phosphate ore. The increase is around 300 yuan/ton, and the price of potassium fertilizer remains strong at a high level. Due to the high prices of raw materials, the support for compound fertilizer cities has been greatly strengthened, leading to an upward adjustment in prices during the off-season, with a magnitude of around 200 yuan/ton. However, downstream demand is not high, so all parties are cautious in their operations. This year, the winter reserve fertilizer time for compound fertilizer has been extended, and large-scale enterprises may negotiate or temporarily cancel their quotations, leading to a tentative increase in prices for small and medium-sized enterprises. However, the factory's winter storage operation is in a dilemma, facing both the imminent start of winter storage and the high prices of raw materials, making it difficult to purchase. Even if there is a later bid, priority should be given to downstream acceptance, resulting in a stalemate in the compound fertilizer market. In November, the annual phosphorus compound fertilizer conference was held, and the country introduced policies to restrict the export of phosphorus fertilizer and urea, extend the legal inspection time, control the export volume, ensure domestic supply, suppress fertilizer prices, and avoid a significant increase in fertilizer prices. Although the winter storage market for compound fertilizers has continued to lengthen this year, it is believed that under policy regulation, the price of compound fertilizers may approach the low end in the later stage, and enterprise production will also show a narrow rebound trend.
In summary, as of now, the compound fertilizer market is temporarily stagnant, with some companies pricing based on regional conditions and receiving small amounts of payments, resulting in a weak trading atmosphere. Most of them are still based on early orders, with significant supply pressure. The short-term compound fertilizer market remains stable with minor fluctuations, and we will continue to pay attention to the trend of raw material prices and the introduction of a new round of winter storage policy prices.
In the first quarter, the overall trend of the compound fertilizer market was downward, with raw materials and urea continuing to decline weakly, resulting in a bearish attitude towards compound fertilizer. In addition, the slight decline in monoammonium phosphate and potassium chloride added to the market's wait-and-see sentiment. At the same time, many preferential policies from manufacturers have been introduced, causing a decline in the focus of trading. Starting from February, urea rebounded strongly, promoting an improvement in market sentiment. As the end use of fertilizers approaches, the sales of green manure have significantly accelerated; In addition, in the Northeast region, with an increase in port arrivals, the wait-and-see sentiment has eased. The main compound fertilizer enterprises still focus on fulfilling early orders, and there has been no significant adjustment in price policies. With the shortening of stocking time and the promotion of dealer replenishment, the sinking of compound fertilizer market supply has accelerated, the market atmosphere has improved, and the volume of goods has increased. In March, the cost support for compound fertilizers weakened. In terms of major compound fertilizer enterprises, they are mostly cautious and cautious. However, due to continuous poor shipments and inventory backlog, some profit margins have increased, and dealers lack confidence. In spring, fertilizer replenishment is mostly pushed forward as needed, while in summer, fertilizer operations are postponed. In the Northeast region, there is a general situation of replenishment and release, and companies are experiencing a phenomenon of selling goods.
In the second quarter, the market mainly sold corn fertilizer, with prices continuing to decline. The overall trend of raw materials is not good, and there is insufficient support for the cost and mentality of compound fertilizers. Most of the corn fertilizer in North China has seen significant sales, with prices mainly due to the decline in high-end prices for large enterprises, abundant orders from small and medium-sized enterprises, and limited price adjustments. In the southern region, market sales are generally average, and there are often signs of delayed operations downstream. For its sulfur based products, some clearance prices have been lowered or flexible transactions have been made, with enterprises in Northeast China mainly clearing their inventory, and sporadic transactions have significantly decreased. In terms of raw materials, urea supply is abundant, downstream demand is slow, supply and demand pressure intensifies, and prices continue to decline; The overall trading atmosphere of ammonium nitrate is light, and the factory price is relatively low; Potassium chloride is also weak, with continuous supply of imported goods and negative effects; Its raw materials are weak and difficult to retreat, which continues to constrain the market. Most of the demand in North China is approaching, coupled with delayed stocking in the early stage and an increase in dealers picking up goods and replenishing warehouses, resulting in a significant increase in market sales. Some enterprises have slightly tight supply sources. The minimum guarantee policy for some enterprises has ended, and prices have slightly decreased, resulting in a narrowing of the price difference for corn fertilizer among enterprises. The market mentality in other regions is unstable, with increased transaction flexibility and a focus on single negotiations. Dealers often purchase goods as needed.
In the third quarter, raw material prices fluctuated, but overall showed an upward trend. Due to the export of 1.14 million tons from India, urea prices skyrocketed, potassium fertilizer prices increased significantly, and phosphorus fertilizer prices remained strong. The price of high nitrogen and high phosphorus fertilizers has increased by around 300 yuan/ton. Most large-scale enterprises maintain high prices, and the autumn fertilizer harvest is still good. In July and August, all enterprises started construction, with a significant increase in daily production and a continuous increase in operating rates. As of the end of August, the raw material urea has begun to show a downward trend, the price of phosphate fertilizer has remained strong, and potassium fertilizer has continued to rise. Some compound fertilizer companies have a heavy wait-and-see attitude. By September, autumn shipments are gradually coming to an end, and the daily production of enterprises is gradually decreasing. The market atmosphere is weakening, and a few enterprises in the Northeast region have tentatively introduced winter storage policies and a small amount of advance receipts.
In the fourth quarter, October, and autumn, the market has basically ended, while the winter storage market has not yet fully opened, and the market has entered a phased off-season. The price of urea fluctuates, while the price of phosphate fertilizer has been continuously increasing due to restrictions on the production of raw materials such as phosphate ore. The increase is around 300 yuan/ton, and the price of potassium fertilizer remains strong at a high level. Due to the high prices of raw materials, the support for compound fertilizer cities has been greatly strengthened, leading to an upward adjustment in prices during the off-season, with a magnitude of around 200 yuan/ton. However, downstream demand is not high, so all parties are cautious in their operations. This year, the winter reserve fertilizer time for compound fertilizer has been extended, and large-scale enterprises may negotiate or temporarily cancel their quotations, leading to a tentative increase in prices for small and medium-sized enterprises. However, the factory's winter storage operation is in a dilemma, facing both the imminent start of winter storage and the high prices of raw materials, making it difficult to purchase. Even if there is a later bid, priority should be given to downstream acceptance, resulting in a stalemate in the compound fertilizer market. In November, the annual phosphorus compound fertilizer conference was held, and the country introduced policies to restrict the export of phosphorus fertilizer and urea, extend the legal inspection time, control the export volume, ensure domestic supply, suppress fertilizer prices, and avoid a significant increase in fertilizer prices. Although the winter storage market for compound fertilizers has continued to lengthen this year, it is believed that under policy regulation, the price of compound fertilizers may approach the low end in the later stage, and enterprise production will also show a narrow rebound trend.
In summary, as of now, the compound fertilizer market is temporarily stagnant, with some companies pricing based on regional conditions and receiving small amounts of payments, resulting in a weak trading atmosphere. Most of them are still based on early orders, with significant supply pressure. The short-term compound fertilizer market remains stable with minor fluctuations, and we will continue to pay attention to the trend of raw material prices and the introduction of a new round of winter storage policy prices.
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