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Can diammonium be used in this state? Author/Source: China Fertilizer Network Date: 2019-07-30 Clicks: 62 As the demand for autumn fertilizers approaches, diammonium phosphate, which is a key type of high-phosphorus fertilizer, has seen its price declining steadily. Currently, the standard ex-factory price for 64% diammonium phosphate in Hubei is 2450 yuan per ton; the actual transaction price ranges between 2350 and 2450 yuan per ton ； The mainstream ex-factory price of 64% diammonium phosphate in the Yunnan-Guizhou region is 2,300–2,400 yuan ； In areas that are not major production zones, the factory outlet price for 64% diammonium phosphate is around 2600 yuan, with prices negotiable upon settlement ； In North China, the prevailing arrival prices for 64% diammonium phosphate are around 2600–2650 yuan; the prevailing arrival price for 57% diammonium phosphate is 2250 yuan, with discounts available for larger orders. This price differs by more than 100 yuan from the level seen during the same period last year. Moreover, most large manufacturers have begun planning to reduce production by 1 million tons in the third quarter in order to ease supply pressures. Additionally, the merger between KaiPhos and Wengfu brings in several positive factors that support prices. Some traders are considering making purchases, believing that the price may have reached its bottom, but most in the industry say they will not purchase for now. The main reasons for this are as follows: First, the price of diammonium phosphate continues to decline. This year, due to pressures from international market conditions, the price of diammonium phosphate began to fall after the end of sales in the spring market. With the announcement that OCP in Morocco is adding new production facilities for phosphatic fertilizers, the competitive pressure faced by Chinese diammonium phosphate in the international market has become even greater. At present, the offshore price for Chinese diammonium phosphate exports is around $335; subtracting this amount from the domestic production cost leaves a gap of about 200 yuan. Even if domestic production may decrease in the third quarter, the supply pressure remains. New export orders are relatively few, and there is a possibility that exports will continue to decline in the future. As a result of these chain reactions, there is still room for further drops in the price of diammonium phosphate in the domestic market. Secondly, domestic market demand is starting slowly. Since most traders earn relatively low profits from the sale of diammonium phosphate, and demand from local markets in regions such as North China is not expected to pick up until around mid-October, most domestic traders are reluctant to stock up on diammonium phosphate at present. As a result, some diammonium phosphate manufacturers reduce prices in an effort to stimulate market demand and increase their sales. Some traders do not plan to make large purchases of diammonium phosphate in the short term, stating that they incur losses each year from dealing in this product and therefore intend to purchase it only as needed this year. Finally, the market trends for mainstream fertilizers such as compound fertilizers are sluggish. This year, the emergence of many best-selling products in the compound fertilizer market has had an impact on this sector, making it increasingly difficult to sell diammonium phosphate. Some distributors say that, given the current prices of compound fertilizers and diammonium phosphate, the profits from selling compound fertilizers are much higher than those from selling diammonium phosphate. As sales of diammonium phosphate face obstacles overall, some manufacturers are forced to reduce prices in order to maintain their market share in the domestic market ； The price of urea has also seen continuous declines, and the domestic market remains weak. In summary, it is expected that the price of diammonium will continue to decline in the coming period. If there is an urgent need, purchases can be made in appropriate amounts; however, if long-term storage is intended, policies such as guaranteed interest payments will be essential. It is still necessary to wait and observe for some time. (Wu Wenchao)