Thread Content
Winter storage price for diammonium is 2800. Have you ordered it yet? Author/Source: China Fertilizer Network Date: 2020-11-09 Clicks: 8 Just a month ago, the author published an article titled \"Winter storage of diammonium fertilizer at 2700 – would you dare to buy it?\" The article analyzes views on the winter storage market from the perspectives of both distributors and manufacturers; looking back at the month since the start of this winter storage market, it is clear that manufacturers hold a dominant position in it. Currently, 64% diammonium fertilizers purchased in Heilongjiang have a delivery price of up to 2,800 yuan per ton (the same unit is used thereafter), and most factories say they have limited stock available; the overall supply in the market is also low. The winter storage market situation seems to be clear now, so the question is: have you purchased any goods? If not, when is the best time to enter the market? To answer these questions, we turn to the current diammonium market. Firstly, supply is tight. As mentioned earlier, the overall supply in the winter storage market was lower than in previous years. However, aside from a few factories that suspended production for special reasons, the operating rate of diammonium phosphate manufacturers remained around 40%, which is roughly the same as in previous years. With overall supply remaining relatively stable, the main reason for the tight supply situation is the strong demand in the international market and purchases by large domestic traders. Most diammonium phosphate factories indicate that shipments can be arranged by December, with some able to do so as early as January. As a result of this, 64% of Hubei-based enterprises have set the ex-plant price for diammonium phosphate at 2,400 yuan, an increase of 100 yuan compared to before ； In the southwestern regions, 64% of the diammonium phosphate is purchased in Heilongjiang at a delivery price of 2750–2800 yuan; moreover, there is a shortage of lower-quality supplies, with prices up by 150–200 yuan compared to earlier periods. Secondly, on the demand side. Just one month after the domestic winter storage market started operating, prices of nitrogen, phosphorus, and potassium all rose. The price of high-quality urea in the two river regions of Shandong was close to 1,800 yuan per unit, while the price of 55% ammonium sulfate in Hubei reached as high as 2,050 yuan per unit. The premium price for 62% potassium chloride at ports has also risen to 2,150 yuan. Given these sharp increases, the rising prices of diammonium phosphate seem less surprising. Some distributors who had previously been hesitant due to the high prices have now started making payments to purchase goods. Domestic demand for winter storage is gradually increasing, with some factories reporting that they have already received 40% of the payments due. Internationally, we are now in November, the off-season for diammonium phosphate exports; the slowdown in new orders seems to confirm this trend. As of the end of October, India’s inventory was only 4.1 million tons, a decrease of nearly 1.9 million tons compared to the same period last year. Given that the pandemic has led to a significant drop in domestic diammonium phosphate production in India, demand will still exist in the future. The current suspension of import activities is mainly due to the limited supply available in the international market. Finally, raw material prices have risen. As the deadline for restricting phosphate rock mining approaches, the price of phosphate rock has risen by 10–30 yuan; as a result, the production cost of diammonium phosphate has increased by 20–60 yuan. Sulfur prices have been rising steadily since October, and the current price of sulfur at Puguang Wanzhou Port is 810 yuan. Recently, the liquid ammonia market has seen steady growth due to low production levels and rising urea prices; the prevailing ex-plant prices in the area around Hubei have reached as high as 3,050–3,100 yuan. According to calculations by China Fertilizer Network, the total cost of high-quality diammonium phosphate in Hubei is around 2,240 yuan, an increase of about 140 yuan compared to previous levels. In summary, in the competition within the winter storage market, diammonium phosphate manufacturers hold an advantage, and they are unlikely to make concessions in the short term. Prices are expected to remain stable or rise going forward; downstream traders can purchase accordingly based on their needs in order to mitigate risks. (Rong Guangwen)