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What will be the price trend for autumn fertilizers in the future? Author/Source: China Fertilizer Network Date: 2021-07-14 Clicks: 21 In mid-July, the autumn fertilizer market is about to enter a period of intense competition. This autumn, the fertilizer market has faced numerous challenges compared to usual, especially in terms of compound fertilizers. Driven up by rising raw material costs, the prices of compound fertilizers have increased significantly, putting constant pressure on companies. As of now, the prices and policies related to autumn wheat fertilizers remain unclear, but some current quotes are at relatively high levels. Taking the 45% chlorine-based high-nitrogen/high-phosphorus series (such as 25-14-6/18-22-5) as an example, the ex-factory price is currently around 2,900–3,000 yuan per ton, which is nearly a thousand yuan higher than the same period last year. The price of wheat fertilizers has risen sharply in autumn, leading to a lack of confidence among downstream buyers in making purchases. Following the tentative attempts by a few compound fertilizer manufacturers to collect payments at the beginning of the market recovery, sales and purchases of wheat fertilizers remain sluggish recently. The main reason for this is the excessively high prevailing prices; it is uncertain whether these high levels will persist in the future. Additionally, fluctuations in the price of urea, the raw material used in these fertilizers, have further dampened buyers’ enthusiasm to make purchases. Considering the current positive and negative factors, fertilizer prices are likely to remain strong in the short term. So, what will be the long-term trend? Firstly, raw material prices remain high and difficult to fall. Following the weakness in local urea prices in China at the beginning of last week, these prices have recently stabilized and started to rise. Although it is currently the interseasonal period between summer and autumn, resulting in low agricultural demand, industrial needs as well as expectations related to printing orders have driven an upward trend in domestic urea prices this time ； The price of monoammonium sulfate remains stable at high levels; the standard ex-factory price for 55% powdered monoammonium sulfate in Hubei is between 3300 and 3400 yuan. Companies have a decent number of orders pending, with some offering quotes only to existing customers on a limited scale, with prices determined on a case-by-case basis ； The potassium chloride market has once again seen high prices, and domestic potassium prices continue to rise; it is likely that there will once again be a situation in which imported and domestic supplies support each other in terms of price. Secondly, what is the progress of preparing fertilizers for wheat? As early as mid to late June, at the end of the period when fertilizer demand for summer corn was at its peak, signs of activity began to appear in the autumn market. A few companies offered tentative quotes for advance purchases, at prices much lower than current levels. Although the amount of money paid by distributors was not large, there were still some transactions. As the market progressed, there was an increase in inquiries and interest from downstream buyers. Some companies were forced to set official prices for their key customers or those in nearby areas; however, these were usually on a temporary basis or with limited quantities available for advance purchase. So far, the progress of stockpiling wheat fertilizers by downstream users is slower than in previous years during the same period. It is expected that the market will develop slowly throughout July, with increased enthusiasm among downstream buyers likely to emerge after August. Finally, prices will become clearer in the future. As the season approaches, the demand for fertilizer for autumn wheat in certain areas is about to reach its peak. Coupled with the further clarification of raw material prices, compound fertilizer manufacturers are forced to introduce autumn pricing and advance payment policies. Moreover, if pricing is delayed or cannot be determined for a long time, downstream customers are likely to turn to other suppliers for their needs, which will result in a loss of some clients. Considering the current market conditions of these raw materials, if the prices of nitrogen, phosphorus, and potassium continue to rise, the prices of compound fertilizers are likely to increase as well. However, given the willingness of end-users to accept such price increases, the scope for adjustment is expected to be limited. In summary, during the autumn fertilization period, there are likely to be no major surprises regarding the price of compound fertilizers, with prices likely to remain high. As for the winter storage market, caution is still required. (Feng Hongyang)