Thread Content
According to Sinochem News, on December 11, in an effort to address the current fluctuations in phosphate fertilizer prices and to ensure an adequate supply of ammonium phosphate during the spring planting season at stable prices, under the guidance of the Economic and Trade Department of the National Development and Reform Commission, the China Phosphate Fertilizer Industry Association and the China Agricultural Means of Production Distribution Association organized a symposium with several phosphate fertilizer manufacturers and distributors to discuss issues such as the current state of the phosphate fertilizer market and ways to resolve supply-demand imbalances. The reporter learned at the meeting that recent fluctuations in phosphate fertilizer prices have drawn widespread attention within the industry. Behind this are cost increases resulting from rising prices of key raw materials such as sulfur and sulfuric acid, coupled with the combined effects of changes in market expectations, adjustments in supply patterns, and the spread of panic. Several phosphate fertilizer manufacturers say that production of phosphate fertilizers is rising steadily. Major manufacturers such as Yunnan Yuntianhua Co., Ltd., Guizhou Phosphorus Chemical Group, Hubei Yihua Group, and Xinyangfeng Agricultural Technology Co., Ltd. have sufficient plans in place for spring sales and supply assurance, ensuring no shortages in the supply of their core products. However, companies generally report that the prices of raw materials such as sulfur and sulfuric acid have risen sharply over the past year, leading to a significant increase in production costs and putting pressure on their operations. Trading companies such as Sinograin Group Holding Co., Ltd. and Sinochem Fertilizer Co., Ltd. also mentioned that the current phosphate fertilizer market is facing issues such as forward-moving demand, logistics congestion, and misallocation of resources; in addition, speculation by some small traders has exacerbated market panic and driven up price expectations. **Officials from the Economic and Trade Department of the National Development and Reform Commission stated that although prices of phosphate fertilizers in some areas have risen to some extent due to cost pressures and expectations, the overall domestic supply is on the rise, providing a solid foundation for meeting the needs related to fertilizer storage for winter and spring planting; prices are likely to return to reasonable levels in the near future. Relevant associations stated that they will continue to act as a bridge to help maintain stability in the market. The China Phosphorus Fertilizer Industry Association will continue to monitor the industry’s operations and help enterprises optimize their production and sales strategies. The China Agricultural Means of Production Distribution Association will coordinate railway capacity as soon as possible to increase transportation efforts to key areas. To accurately resolve the current market contradictions, the participants suggested using a series of measures to stabilize market expectations. First, suspend the export of phosphate fertilizers until August 2026 to prioritize ensuring domestic supply. Second, strict control is exercised over rising raw material costs; companies that supply raw materials for phosphate fertilizers such as sulfur and sulfuric acid are encouraged to sign long-term supply agreements with phosphate fertilizer manufacturers, so as to meet domestic demand first. Third, improve long-term trading mechanisms, make full use of relevant trading platforms, and encourage enterprises at all stages to establish long-term cooperative relationships. Fourth, standardize the order in the distribution process by encouraging large-scale distribution and storage companies to establish connections with enterprises that use fertilizers directly as well as large-scale farmers, thereby reducing the number of steps in distribution and lowering distribution costs. Fifth, crack down severely on speculation and unreasonable price hikes, and guide enterprises to reasonably control their profit margins during special periods. Sixth is to appropriately adjust the assessment criteria for nitrogen, phosphorus, and compound fertilizer reserves, as well as to strengthen coordination in railway transportation. In addition, the meeting also held in-depth discussions and exchanges on exploring the establishment of a sulfur reserve system and a joint bargaining system for imports.