Is there a future for the compound fertilizer industry?
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This post was last edited by zhaohh3211 on 2010-6-7 at 16:12. The sulfur-based ternary compound fertilizer plant has been in operation for 9 years, with an annual production capacity of 150,000 tons; it has suffered losses for 9 consecutive years, with the total loss amounting to over 100 million. There is an excess of compound fertilizers in the country, and it’s really sad when workers in this industry face difficult conditions! I wonder when the compound fertilizer industry will find a way out?
The trend of supply often exceeding demand is still spreading, putting all companies at risk. The technological level of compound fertilizer companies is similar, and their manufacturing costs are not much different. To survive, sales are the key; all threads are tied together through this single thread of sales. Resource advantage: Low raw material costs. Or a financial advantage: raw material costs account for nearly 90% of the total cost of a product; compound fertilizers have low profits per unit. Only by obtaining cheap raw materials can there be room for generating profits. Or market advantage: large companies compete on price, while small companies compete on the market; it’s important to do a good job in market segmentation and to have products that meet customer needs. Good sales lead to high volumes, low production costs, and reduced financing costs.
In today’s China, which industry does not suffer from overcapacity? There are only losing companies, no industries that lose money. I just entered the wrong door, not chosen the wrong career.
There are no industries that suffer losses; only companies do. In the production of compound fertilizers, it is only through careful planning, along with high quality, excellent product standards, and a solid corporate reputation, that survival and development can be achieved.
May I ask the original poster: What technology is used in your compound fertilizer production equipment? What is the production scale?
The compound fertilizer market is still very large. The low level of technological advancement has led to an excessive number of companies in this sector, resulting in high production capacity. Fierce price competition further reduces profits. Low prices for agricultural products discourage farmers from farming, and many of them switch from growing crops twice a year to growing them only once a year. In the south, where fields used to be planted with rapeseed and wheat during winter, now almost nothing is planted there in winter. Market demand is also declining. A good brand name is crucial in this industry; it makes it easier to succeed in the market. Farmers are gradually becoming more aware of brand names, as they trust brands that offer better quality and service