Weekly Report on the Compound Fertilizer Market for the First Week of January 2017

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Weekly Report on the Compound Fertilizer Market for the First Week of January – Author/Source: China Fertilizer Network – Date: 2017-01-09 – Clicks: 24. This week, most compound fertilizer manufacturers continued to raise their prices; these were mainly companies in Shandong, Jiangsu, the two Hubei provinces, and Anhui. The pricing for winter storage in the Northeast region remains uncertain. Currently, the provisional ex-factory prices for winter storage of 45% Cl(15:15:15) compound fertilizer are around 1,800–1,980 yuan per ton (the same unit is used throughout). For 45% S(15:15:15) compound fertilizer, some provisional ex-factory prices for winter storage are around 2,050–2,150 yuan, while higher-end prices range from 2,350–2,400 yuan. This week, prices of chlorine-based fertilizers have risen significantly, and most companies have discontinued their promotional offers. A series of factors such as the ongoing rise in raw material prices, increasing environmental pressures, and shortages of shipping containers have not eased this week. At the same time, the price of urea, a key raw material, has risen sharply, leading to further increases in the prices of compound fertilizers this week, by around 50–100 yuan per ton. However, since these new prices have just been introduced, there is limited acceptance on the part of end-users; most companies continue to fulfill previous orders. Sales in the Northeast region have seen some improvement this week, but most companies in that region have not yet set prices for winter storage, with these prices expected to become clearer around mid-January. Affected by environmental inspections, the operating rates of a few compound fertilizer manufacturers have declined; some of these companies are still shut down, as a result of which the overall operating rate for compound fertilizers has dropped slightly to around 62%. In terms of raw material costs: The rain and snow in Shandong, the two river regions, and parts of Shanxi have helped to alleviate the foggy conditions to some extent. The operating rate of urea production plants remains low. However, due to the impact of rain, snow, and fog, the shipment of urea remains difficult, and there is little willingness on the part of farmers to make purchases. As a result, the prevailing ex-factory price of urea in Shandong remains stable at 1660–1670 yuan ； In Jiangsu province, the prices of ammonium chloride offered by some companies have seen a slight increase. The typical ex-factory price for wet ammonium is around 460–490 yuan, while that for dry ammonium is around 560–590 yuan; deals can be made at slightly lower prices ； In the southwestern region, the prevailing ex-plant price for 55% powdered monoammonium nitrogen is currently stable at around 2000 yuan; manufacturers are able to accept a small number of orders for early-stage placements ； The price of potash fertilizer from salt lakes has increased by 30 yuan; the price for 60% powder and crystal forms, as supplied to agents at the delivery site, has reached 1950 yuan. The selling prices for these products offered by agents have been raised accordingly, while some of them are temporarily out of stock ； On January 4, SDIC Luojiu raised the price of potassium sulfate by 100 yuan; the current delivery price for 51% powder is 2,450 yuan, while the delivery price for the new 52% powder is 2,500 yuan. There is a surcharge of 150 yuan for granular form and 40 yuan for products delivered under an acceptance agreement. Production and transportation are running smoothly, with a daily output of around 6,000 tons. Overall, rising raw material prices continue; compound fertilizer manufacturers have run out of low-cost raw materials. With strong cost pressures and the impact of environmental regulations limiting production, the prices of compound fertilizers have risen by another 50–100 yuan. It is expected that these prices will remain high in the short term, and it will be necessary to closely monitor the prices and production levels of raw material suppliers in the future. (Yang Xiaomei/Li Qingling)