Will the fertilizer market emerge from the harsh winter this year?

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Will the fertilizer market emerge from the harsh winter this year? Author/Source: date: 2017-02-10 Click rate: 40 At the end of 2016, the fertilizer market experienced a hike, and the prices of urea and other products rose sharply, making many people optimistic about the market trend in 2017. However, some experts pointed out that the fertilizer market will be a year of recuperation in 2017. It is expected that the market trend in 2017 will be better than that in 2016, and the extremely depressed market in 2016 will not occur again. With cost support, fertilizer prices are expected to increase by 100 to 400 yuan (ton price, the same below) in 2017 compared with 2016. However, the market is still in the painful process of reducing overcapacity, and the overall market is relatively weak. The market will show the following characteristics. 　　Output has declined. Data shows that China's total fertilizer production capacity has reached 131.67 million tons, and output has reached 80.11 million tons, while demand is only 66.1 million tons, with a surplus of 14.01 million tons, and excess production capacity of nearly 50%. In 2017, the problem of excess production capacity of nitrogen fertilizers and phosphate fertilizers will still be prominent, while the production capacity of potassium fertilizers will further increase. Relying on its resource and technological advantages, large potash fertilizer plants still have plans to expand production. It is expected that the new potash fertilizer production capacity will be about 700,000 tons in 2017, and the small potash fertilizer production capacity will be withdrawn from only about 200,000 tons. 　　The production capacity of nitrogen fertilizers and phosphate fertilizers far exceeds market demand. Only by reducing the operating rate can supply and demand be basically balanced. Since the price of chemical fertilizers is unlikely to be too high in 2017, many nitrogen fertilizer and phosphate fertilizer companies will still be at a loss, and some small potash fertilizer companies will also lose money. Therefore, chemical fertilizer output will decline to a certain extent in 2017. 　　Demand is stable but declining. It is expected that agricultural planting area will decrease in 2017. First, the rapid development of industry, railways, highways, real estate and other industries has occupied part of the cultivated land. ； Second, the price of agricultural products is low, farmers are not very enthusiastic about planting, and the phenomenon of abandonment of wasteland is prominent in some places. The basis for increasing the amount of chemical fertilizers by increasing the planting area no longer exists. along with * * With the implementation of the zero-growth strategy for chemical fertilizers, the vigorous promotion of soil testing and formula fertilization, and changes in fertilization methods, the reduction of total fertilizer consumption is the general trend. Due to the promotion of slow-release fertilizers, field crops in North China, East China and other regions have used fertilizers in three seasons a year (wheat top dressing, corn fertilizer and wheat base fertilizer) instead of two seasons (corn fertilizer and wheat base fertilizer), and the demand for chemical fertilizers has declined steadily. Exports are not optimistic. There are favorable conditions for fertilizer tariffs in 2017. Nitrogen and phosphate fertilizer products have zero tariffs. Only potassium fertilizers and potassium-containing compound fertilizers retain export tariffs. The overall export tax rate has dropped significantly. Due to China's weakening competitiveness in the international fertilizer market and the increase in new international fertilizer production capacity, fertilizer exports in 2017 are not optimistic, and export volume may fall by more than 10% compared to 2016. 　　Although China's urea production capacity is large, a considerable part of the production capacity cannot survive according to the current international market prices. In the future, China's urea exports will face competition from urea in the Middle East and West Africa. Ammonium phosphate exports will also be impacted by products from low-cost regions such as the Middle East. 　　Rising production costs drive prices higher Rising production costs have become the main factor driving up the price of chemical fertilizers in 2017. It is expected that the price will increase by 100 to 400 yuan in 2017 compared with 2016. 　　The main factors driving up the price of nitrogen fertilizer are coal prices and electricity prices. Thermal coal price is expected to be above 500 yuan in 2017, an increase of about 200 yuan compared with 2016. Since April 20, 2016, all preferential policies for fertilizer electricity have been cancelled. The average electricity price in 2017 has increased by about 3% year-on-year, and the cost of nitrogen fertilizer production has increased. 　　Potash production costs are also rising. On the one hand, rising labor wages, increased resource taxes, etc. have increased mining costs. ； On the other hand, potash fertilizer production areas are concentrated in Qinghai and Xinjiang, and the transportation distance is long. With the cancellation or reduction of preferential railway freight policies, freight costs will increase. 　　Environmental factors have a great impact on the market. With the intensification of environmental protection rectification, environmental factors will become an important factor affecting the fertilizer market in 2017, which is also the year with the greatest impact in history. Improved environmental protection standards and intensified supervision will, on the one hand, increase production costs, and on the other hand, affect the operating load of enterprises, affect fertilizer production, and thus affect the market supply and demand. (Henan Daily)