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More good news for diammonium phosphate; strong performance may continue. Author/Source: China Fertilizer Network. Date: 2021-01-11. Clicks: 7. While everyone’s attention is focused on the domestic winter storage market, diammonium phosphate manufacturers have achieved great success in the international market. Chinese companies won the bids for all 115,000 tons of goods in Bangladesh’s tender process. The ex-ship price of these goods has risen to $390–$400 per ton. Considering that Pakistan’s domestic inventory is only 50,000 tons, and India’s inventory is also much lower than in similar periods in the past, the ex-ship price of 64% of the diammonium phosphate produced by some factories has already risen to $405 per ton. Following the rise in raw material prices, another positive factor has emerged for diammonium fertilizers. Will the stalemate in winter stockpiling be broken, and will this strong market trend continue? Just after the New Year’s holiday, the diammonium phosphate market in regions such as the Northeast and Northwest remained in a relatively stagnant state. Downstream distributors were not interested in the price increases imposed by certain diammonium phosphate manufacturers, mainly because farmers at the grassroots level had not yet begun to stock up on fertilizers. Although grain prices have risen, the wholesale and retail prices of fertilizers have not increased significantly compared to spring. Most local farmers and small and medium-sized traders prefer to wait until after the Lunar New Year before making purchases. Larger traders, in order to avoid risks, refrain from placing further orders and continue to wait for supplies available at lower prices. However, the suspension of purchases does not mean an end to demand in the winter storage market; the slow decline in demand for diammonium phosphate is simply because there is still a long time before the actual period when fertilizers are needed, as can be seen from the similar deadlock in the compound fertilizer market. The high prices of corn this year will surely influence farmers’ planting decisions next year, while the domestic demand for diammonium phosphate as a fertilizer in the spring is guaranteed. A delay in demand will not put too much pressure on diammonium fertilizer manufacturers. The delivery dates for most diammonium fertilizer plants are set for February, while some companies have production orders scheduled for March; factory inventories remain low for extended periods ； Recently, some enterprises in the southwest have been forced to reduce production or shut down due to high prices of synthetic ammonia, which has also led to delays in delivering orders ； The period of checking stock levels of commercial fertilizers is gradually approaching in various regions, and minor shipments have also begun in non-key markets such as North China ； With the increase in international demand, new orders, in terms of both price and quantity, will provide support for the domestic sales of diammonium phosphate manufacturers; going forward, such demand will be one of the key factors driving up prices for diammonium phosphate in the domestic market. It can be seen that the company is not under any sales pressure at the moment; going forward, attention should be paid to export conditions and raw material prices. Raw material costs cannot be ignored. The author’s previous analysis article focused on the impact of synthetic ammonia on the production costs of diammonium compounds. Although supply of urea and synthetic ammonia in the southwestern region has improved recently, the overall supply remains tight. Some companies that rely on imported materials report that the price at their plants is still above 4,000 yuan; those companies that suspended or reduced production earlier have not yet resumed operations. Regarding sulfur, domestic inventory levels have been on the decline. Coupled with the fact that the offshore prices from key importing countries such as Kuwait have risen above $100, domestic manufacturers are inclined to raise prices. At present, the price of granular sulfur at the Yangtze River port is around 975 yuan, while the prices at the Puguang Wanzhou port and the Dazhou plant have risen to between 950 and 870 yuan respectively, with further increases likely in the future. The high production costs of diammonium continue to act as a support for prices in the future. In summary, the increase in international demand and rising prices have once again provided positive factors for the diammonium market, but domestic demand still needs to increase; in the future, attention will also need to be paid to purchasing trends in downstream sectors. (Rong Guangwen)