Industry News
Lack of market demand support for ammonium sulfate prices may continue to fluctuate
Last week, the price of ammonium sulfate in many parts of the country decreased slightly, with some factories experiencing an increase in prices. As of December 15th, the mainstream ex factory price of ammonium sulfate in China was between 705-780 yuan/ton. This week, there is still a downward trend in the price of ammonium sulfate. Why has urea, which belongs to the same nitrogen fertilizer, been fluctuating at a high level, while the price of ammonium sulfate is at a low level, and there is a possibility of further decline?
On the one hand, domestic demand is average. The composite fertilizer winter storage market continues to remain stagnant, although the winter storage market is basically stable, market purchasing and sales activities are still slow. Recently, the raw material market has been weak and volatile. In addition to a decline in urea prices, the prices of ammonium and potassium chloride are not as strong as before, and the cost support for compound fertilizers has weakened, leading to slight signs of weakness in the compound fertilizer market prices. At present, the quotation changes of compound fertilizer companies in various regions are very limited. Some companies have introduced relevant preferential policies, and the actual transaction prices have remained stable and secretly decreased. At the same time, rumors of local low prices have increased, and the market price gap has widened. Therefore, most dealers are not in a hurry to restock, especially in high price situations. Therefore, compound fertilizer companies, water-soluble fertilizer companies, and agricultural distributors only purchase ammonium sulfate on demand and dare not purchase too much, resulting in a lack of support for the price of ammonium sulfate.
On the other hand, export orders are currently average. In recent years, ammonium sulfate has seen a significant increase in export volume without being affected by legal inspections, and has remained the top exporter of fertilizers for several years. It is understood that approximately 70% -80% of ammonium sulfate is used for export every year; The annual export volume of ammonium sulfate in 2022 was 12.45 million tons, and the national annual physical production was approximately 16 million tons. Both are still continuing to grow this year. It is understood that the recent situation of receiving goods at ports has not been ideal. It is rumored that Longkou Port temporarily did not receive goods last week, and the arrival price was around 800 yuan/ton. Tianjin Port's arrival price was around 900 yuan/ton, and export orders were temporarily average. Last week, international prices fluctuated, and the offshore price of caprolactam in China generally decreased by about 5 $, while the particle price increased by about 3 $. Although the landed price in Brazil remained stable and upward, the enthusiasm for receiving goods was average, So the international market doesn't have much support either.
In summary, the domestic market demand for ammonium sulfate lacks support, and compound fertilizer companies, water-soluble fertilizer companies, and agricultural distributors only purchase ammonium sulfate in moderation due to unstable prices. Export orders are currently average, and we haven't heard of any major orders yet. We need to closely monitor export trends. If there is no significant increase in export orders, the price of ammonium sulfate may continue to fluctuate.
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