What impact will the northern drought have on the fertilizer industry?

Drought has reduced farmers' enthusiasm for growing grain, and fertilizer sales are expected to be affected.

I don’t think the impact is big, because some companies were shut down due to the financial crisis in the second half of last year, and now some companies are still operating at full capacity.

The recent persistent dry weather in some parts of the north has made the industry worried about whether the fertilizer market and fertilizer prices, which are closely related to crops, will be affected. In this regard, commodity information provider Yimao Information told the Shanghai Securities News last week that the impact is not yet obvious. 　　Since November last year, the rainfall in the Huanghuai River Basin has been significantly less, and drought weather has continued in some areas. The drought has affected the normal growth and development process of wheat, and the proportion of small, weak, and yellow seedlings has increased. The winter wheat areas in eight provinces including Hebei, Shanxi, Anhui, Jiangsu, Henan, Shandong, Shaanxi and Gansu have a total drought-affected area of ​​139 million acres, accounting for approximately 46% of the winter wheat sown area in the above eight provinces, of which 43.89 million acres are severely drought-stricken. although * * Funds have been allocated to combat drought and protect seedlings, to remediate disaster-stricken crops to the maximum extent and ensure grain production. However, whether the fertilizer market, an important agricultural product, will be affected is still of particular concern. 　　In this regard, relevant sources from Yimao Information said that according to the current situation, the overall impact of the drought on the fertilizer market is not obvious. Top dressing of winter wheat planting areas is being carried out one after another, and the demand for nitrogen fertilizer has increased significantly. For this reason, some areas have slightly increased wholesale prices. 　　He revealed that various disaster-stricken areas are currently irrigating wheat fields in different ways through connecting water pipe networks, artificial rainfall, etc., and are also irrigating with top-dressing fertilizers, and there may be different levels of concentrated fertilizer use. So even on affected farmland, demand for fertilizers remains strong. Of course, some wheat seedlings have been severely affected and may not survive or have dried up, making the use of fertilizers futile. 　　“Overall, the impact of the current drought on fertilizer market demand is definitely there, but it is not yet obvious. However, it cannot be ruled out that the quality of the base soil has deteriorated due to drought in the early stage, which will have some impact on this year's spring plowing. ”said the person above. (Yingshan) (from Jinnong.com)

The international urea market price continues to recover. On the 28th, the FOB price of urea in the Arab region has rebounded to US$290/ton. The price dropped by US$5/ton from the previous week, but increased by US$30/ton from mid-January.； The urea market in most areas of the country has improved, with the ex-factory price rising slightly to around 1,700 yuan. The market in Jiangsu has not yet started, and the price is around 1,680 yuan/ton. The price of diammonium in Tampa began to rebound during the holidays. On the 28th, the price was around US$355/ton, an increase of US$25/ton from mid-January. The domestic market price of diammonium showed no significant change. Potassium fertilizer prices have not improved significantly.

The fertilizer industry suffered a disaster in 2008 2009/1/16/08:15 Huicong Chemical Network News Due to exports, the fertilizer industry almost reached the "highest level of historical development last year"”； Due to exports, the fertilizer industry suffered a disaster last year and almost had to start all over again. To be honest, the topic of export is not very exciting in the chemical industry, and it even makes people feel a little shameless. Because almost all products that can be exported are "two highs and one capital" products produced by fighting for resources, energy consumption and pollution, such as fertilizers, coke, rare earths, etc. Some people have long criticized that first-class resources and second-class products have led to the cheap export of a large number of domestic resources and the instability of the domestic market. For this reason, China * * At the expense of "domestic demand", the policy of encouraging exports has been changed, and export tariffs on such products have been continuously raised since 2004. In 2008, * * It has set a record of raising export tariffs on fertilizer products for five consecutive times, with the highest export tariff on fertilizers reaching 175%. The purpose is to restrict fertilizer exports. The soaring international fertilizer prices are like the red cloth in the hands of a matador, tempting Chinese fertilizer companies to continue to charge the price regardless of the price. The result is * * While exports continue to be suppressed, export volume continues to grow. Large amounts of exports create two problems: One is that domestic fertilizer prices have continued to soar, and have even seen the largest increase in fertilizer prices in recent years. Especially during the spring plowing season, some fertilizer products are out of stock, and in some areas they are even priced but not available. ； The other is that China's fertilizer companies are diligently serving foreign orders. Whether they are backward or advanced, as long as they can turn over, all devices are turned on, consuming water, electricity, coal, oil, and gas... Fertilizer companies will desperately expand production as long as they have spare money. At that time, some sober-minded companies called on fertilizer companies to reduce product exports and stabilize domestic fertilizer prices as a conscious action, but their voices have long been called upon. * * It was drowned out by calls to relax tariffs in order to seize opportunities in the international market... Fortunately, faced with this situation, China * * There was no mercy, and we continued to increase regulation and control, finally controlling the momentum of fertilizer exports after July and August. As the proverb goes, you will only see mud on your legs when you are out of the water. With the decline in exports, fertilizer prices fell sharply after September. Companies also sort out the good and the bad at this time. Some companies that sold fertilizers happily in the first half of the year discovered that their products were actually not competitive at all. At this time, it is already too late to consider technical changes! It wasn't until the financial crisis began to spread that the bullfighting show came to an end. Faced with sudden changes in the market, most fertilizer companies are helpless. In a short period of time, domestic fertilizer companies were in dire straits, and some major fertilizer provinces even stopped operations. Fertilizers went from being the most popular product to the most negative product. Faced with such a tragic situation, some people in the industry blamed the global financial crisis and even the * * Strict tariff policy. They have not yet realized that every surge in international fertilizer prices is a fatal deception of China's fertilizer industry giving up on self-development. Each time, China's fertilizer industry has to pay a heavy price in terms of development stagnation or even regression. This time is no exception. According to industry insiders, when exports were at their peak last year, 3 million tons of new domestic production capacity was still untapped, and it is expected that another 4.3 million tons of production capacity will be added this year. If there was no such round of exports * * , in the first two years * * Under the regulation of energy conservation and emission reduction policies, supply and demand in the domestic fertilizer market may have found a balance. Now the balance has been broken again and needs to be found again, and a large amount of resources have been donated to foreign countries and cannot be found again. If there was no export this time * * , new growth points for the enterprise may have been found, technological transformation has been completed, and new products have been successfully developed. Now, the company is in operating difficulties again. Last year, amid a swarm of media calls for * * When relaxing exports, an article in China Chemical Industry News said pertinently: “if * * Failure to control the disorderly export of urea and ammonium phosphate will eventually lead to duplication of construction and overcapacity, and will accelerate the consumption of China’s already scarce resources. Our enterprises should think calmly and develop * * The supply of fertilizers to the international market can be reduced to protect domestic resources. Should China be allowed to fill this gap? Once the demand for fertilizers in the international market suddenly decreases significantly, the contradiction of serious overcapacity of domestic nitrogen fertilizers and phosphate fertilizers will intensify, and fertilizer companies will suffer greater losses. ”Unfortunately, this advice was largely ignored at the time. What is even more unfortunate is that the subsequent financial crisis confirmed this judgment. Remember the painful lessons learned in 2008. The development of the fertilizer industry must not rely on exports.

Actual ex-factory price of domestic urea on February 9 2009/2/10/11:29 Huicong Chemical Network Region and Province 2009-2-3 2009-2-4 2009-2-5 2009-2-6 2009-2-9 Unit Price Description Remarks North China Hebei 1690-17201700-17201700-17201700-17201750-1770 Yuan/ton ex-factory price market has started, companies are selling well, and price pressure is high Shanxi 1650-17001650-17001680 -17201680-17201720-1750 yuan/ton ex-factory price Tianjin 1650-16701690-17001690-17001690-17001720-1750 yuan/ton ex-factory price Enterprise output is small, shipments are relatively tight East China Shandong 1 680-17301680-17301700-17401700-17401740-1770 yuan/ton ex-factory price mainstream quotation in the province 1750-1790 Jiangsu 1680-17001680-17001680-17001680-17001 700-1720 yuan/ton ex-factory price market has started slightly Anhui 1640-16901640-16901640-16901640-16901640-1690 yuan/ton ex-factory price market is still relatively deserted Jiangxi 1700-17501700-17501700 -17501700-17501700-1750 yuan/ton ex-factory price is around 1750 yuan/ton locally, and 1700 is shipped to Zhejiang 1650-17001700-17301700-17301700-17301700-1730 yuan/ton ex-factory price Fed-based, sales Bad Central Hunan 1700-17501780-18001780-18001780-18001780-1800 yuan/ton ex-factory price Hubei 1650-16801700-17501700-17501700-17501700-1750 Yuan/ton ex-factory price. Transaction price in the province. Large particles are around 1730. Henan 1730-18001730-18001730-18001730-17701700-1750 Yuan/ton ex-factory price. The market is over. Enterprises reported 1720-1780. South China Fujian 1720-1720 1720-17201720-17201720-17201780-1800 Yuan/ton ex-factory price Enterprises continue to adjust prices Guangdong-----Yuan/ton ex-factory price Hainan 1650-17251650-17251650-17251650-17251650- 1725 yuan/ton ex-factory price for outsourcing 1650 Northeast Heilongjiang 1700-17501700-17501700-17501720-17601720-1760 yuan/ton ex-factory price Fed is mainly, temporary collection 1650-1750 Jilin 1720-17301720 -17301730-17801730-17801730-1780 yuan/ton ex-factory price The downstream receiving goods are relatively active in Liaoning 1650-17001700-17001700-17001700-17001700-1700 yuan/ton ex-factory price market is about to start Moving, rising trend Southwest Sichuan 1680-17201680-17201680-17201740-17801740-1780 yuan/ton ex-factory price mainstream brands adjust prices Yunnan 1780-18501830-18501830-18501830-185 01830-1850 Yuan/ton ex-factory price. Enterprises have not started operations enough and are running well. Guizhou 1820-18501820-18501800-18201800-18201800-1820 yuan/ton ex-factory price. Some enterprises have stopped for maintenance, and the supply of goods is tight Guangxi 1850-19 301850-19301850-19301850-19301850-1930 yuan/ton ex-factory price follows the market, and the quotation is increased Chongqing 1730-18001730-18001720-17501720-17501720-1750 yuan/ton ex-factory price The factory price is affected by surrounding areas. Northwest Inner Mongolia 1620-16501650-16801650-16801650-16801650-1680 yuan/ton ex-factory price is shipped to Northeast, North China, Southwest and other places. Shaanxi 1780-17801780-17801780-17 801780-17801780-1780 yuan/ton ex-factory price market is launched, and the downstream goods are Ningxia 1740-17401740-17401740-17401740-17401740-1740 yuan/ton ex-factory price Gansu 1750-17801750- 17801750-17801750-17801750-1780 Yuan/ton ex-factory price There are few companies operating and supply is tight

The demand for nitrogen fertilizers is amplified, but the drought in the north has limited impact on the chemical fertilizer industry 2009/2/10/10:44 Source: Shanghai Securities News Huicong Chemical Network Recently, drought weather has continued in some parts of the north, which has caused the industry to worry about whether the fertilizer market and fertilizer prices, which are closely related to crops, will be affected. In this regard, commodity information provider Yimao Information told the Shanghai Securities News last week that the impact is not yet obvious. 　　Relevant people from Yimao Information said that top dressing is being carried out in winter wheat planting areas, and the demand for nitrogen fertilizer has increased significantly. For this reason, some areas have slightly increased wholesale prices. 　　He revealed that various disaster-stricken areas are currently irrigating wheat fields in different ways through connecting water pipe networks, artificial rainfall, etc., and are also irrigating with top-dressing fertilizers, and there may be different levels of concentrated fertilizer use. So even on affected farmland, demand for fertilizers remains strong.

Severe drought has not affected the fundamentals of spring plowing fertilizers2009/2/10/10:42 Source: China Fertilizer Information Network Huicong Chemical Network News Due to continued drought and poor moisture conditions in my country's main winter wheat-producing areas, the reserve and application of spring plowing chemical fertilizers have been seriously affected. Over the past few days, reporters have learned from investigations that the central and local governments have urgently taken strong measures to fight drought and protect seedlings, such as the "water and fertilizer attack". At present, many drought-affected areas have achieved fruitful results in preserving seedlings and returning them green, and farmers have actively increased their fertilization. Experts' analysis and judgment that the fundamentals of fertilizer use this spring will not be fundamentally affected by the drought have given fertilizer manufacturers a "reassurance." Currently, my country's main wheat-producing areas are suffering from severe drought. Data from the Ministry of Agriculture show that as of February 4, 145 million acres of wheat have been affected by drought in Henan, Anhui, Shandong, Hebei, Shanxi, Shaanxi, Gansu and other main producing areas. The drought-affected wheat planting area has reached close to 43% of the country's winter wheat planting area. Due to the continuous lack of water in the soil, the moisture content is not suitable for fertilization, which has become one of the main reasons why farmers are reluctant to buy fertilizer before the Spring Festival and dealers are afraid to prepare fertilizer. The central government attaches great importance to this. In addition to dispatching working groups to severely drought-stricken areas to guide local watering and irrigation and rational fertilization, it has also successively invested 400 million yuan in extra-large drought relief subsidies and agricultural production disaster relief funds. All regions are using funds wisely. In addition to watering, digging wells, and maintaining soil moisture, Henan has taken multiple measures to ensure the supply of agricultural production materials such as fertilizers, pesticides, and seeds. ； Anhui has allocated 300 million yuan in comprehensive agricultural subsidy funds in advance to support farmers in purchasing chemical fertilizers and other drought-resistant and seedling protection materials. As of February 7, 70% of the country's main winter wheat-producing areas have secured water sources, which provides the necessary conditions for farmers to increase their fertilizer application.

Chemical industry: Crude oil and refined oil urea market analysis 2009/2/10/08:07 Source: China Fertilizer Network Urea: Export-driven price increases International urea prices have risen sharply again recently, with the FOB price of large granular urea in the US Gulf rising from US$368/ton at the beginning of the month to US$425/ton. As international urea prices have been rising, export volumes have increased, and domestic prices have also begun to rise. At present, the ex-factory price of enterprises has generally increased to 1800-1850 yuan/ton. Coupled with the tight domestic railway transportation, prices remain high. Although the price is high, there is basically a price but no market, and the trading volume is not large. Dealers for winter storage are also in a wait-and-see mode. The excess domestic urea production capacity has not changed, and future trends will continue to be affected by fluctuations in international urea prices.