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The urea competition continues; can monoammonium survive in this market? Author/Source: China Fertilizer Network Date: 2020-05-14 Clicks: 4 Recently, the price of urea has been declining slightly, especially in the main production areas such as Shandong and the Two Rivers region. At present, compound fertilizer manufacturers in Linyi are purchasing urena at a price of 1620–1630 yuan per ton. In previous years, urea manufacturers received a good volume of orders before the long holidays; even with price cuts, they could still get a large number of orders to fulfill. This year, however, urea factories did not receive as many orders before the May Day holiday, and after the holiday, these factories faced difficulties in selling their products. As a result, their prices continued to drop. The downstream sector is either waiting to see what will happen or has already finished making its purchases. Due to the ample supply, there is still room for urea prices to continue falling. The battle over urea continues; so what is the situation with monoammonium phosphate, which is also used as a raw material for compound fertilizers? Can it make a living based on “ammonium”? On the supply side. In previous years, May was the annual maintenance season for ammonium sulfate manufacturers. However, this year is different from before: in Hubei, the main production region, these companies had a low operational rate due to the impact of the pandemic, with less than 30% of them operating. At present, most of these companies do not have any plans for maintenance; they are busy processing orders that have been received. Although the growth rate of pending orders has slowed down since April, shipments are proceeding smoothly. Some companies have achieved a balance between production and sales, with little or no inventory left. So far, only a few companies have started their maintenance work, scheduled to begin in early or late May and last for one to two weeks, while most companies continue to operate normally. Although most enterprises in Henan have maintenance plans scheduled for later periods, this has little impact on the overall operational rate of ammonia production. However, based on past experience, it is still necessary to pay attention to any changes in the operation status of enterprises in Hubei; once the orders are fulfilled, some of these enterprises may carry out temporary maintenance on their facilities. On the demand side. Demand is not very favorable in the short term; the consumption of compound fertilizers is low in some provinces and cities in the south. Some distributors say that there is still inventory of compound fertilizers purchased before and after the New Year, so there is little need for additional purchases. In regions such as North China, where there is a demand for high-nitrogen fertilizers, distributors are not very enthusiastic about making purchases – although there is some demand, the atmosphere is not positive. Recently, compound fertilizer manufacturers have also reported weak sales of such fertilizers. A major compound fertilizer producer in Shandong said that replenishments of ammonium nitrate should have taken place in mid-month, but due to poor sales and the fact that some of the production facilities for compound fertilizers will be under maintenance soon, purchases of ammonium nitrate as a raw material are expected to be postponed until June. It can be seen that demand may not be as satisfactory in the short term, but in the long run, demand for monoammonium in autumn is promising. In terms of raw materials. In recent months, the inventory of sulfur at the port has gradually declined to around 2.7 million tons. Coupled with the recent rise in prices on the electronic trading platforms for sulfur, the atmosphere in the port’s sulfur market has improved and prices have gone up. Currently, the price of granular sulfur at the Yangtze River Port and Fangchenggang Port has risen to 610 yuan per ton, but industry experts believe that there is no possibility of further significant price increases at present. The price of liquid ammonia remains low; currently, the ex-plant price for liquid ammonia in Hubei is between 2550 and 2570 yuan. Overall, negative factors prevail in the short term, and there is still a risk of a slight decline in prices for monoammonium phosphate. However, in the long run, the industry retains some confidence in the demand for monoammonium phosphate in the autumn, hoping that its prices will recover despite the challenges. (Zhao Hongye)