The domestic fertilizer industry is facing the dilemma of overcapacity

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In mid-May, facing the peak of fertilizer preparation and consumption that had already begun, the domestic fertilizer market was still in a sluggish state, with no obvious improvement. Despite the sharp rise in raw material prices, the price of fertilizer this year is lower than last year, the operating rate of enterprises has dropped, and the concentration of products in ports has accelerated. In addition to the impact of this year's abnormal weather, the impact of overcapacity has been revealed. Judging from the situation across the country, although the peak of chemical fertilizer use has been delayed due to the cold spring, spring sowing has been started or completed in Northeast China, and summer corn and mid-season rice in North China, East China, and Central China will also enter the fertilizer season. However, even in the peak season of spring fertilizer use, fertilizer prices have not yet bottomed out. The normal rise in fertilizer market prices during the peak season and the long-awaited profit prices for production companies have not appeared this year. At present, the wholesale price of urea is roughly below 1,700 yuan/ton, 45% chlorine-based compound fertilizer is 2,000 yuan/ton, sulfur-based compound fertilizer is about 2,200 yuan/ton, 55% monoammonium has a factory price of 1,850 yuan/ton, and 64% diammonium has a mainstream factory price of 2,650 yuan/ton. Compared with the same period last year, these prices include urea, which is down by about 100 yuan, ammonium phosphate, which is basically the same, and compound fertilizer, which is down by 300 yuan. Data show that the fertilizer market and operating conditions during the same period last year were not ideal, and the fertilizer market was lukewarm. Compared with last year, the prices of natural gas, sulfur and other raw materials have increased this year. At the end of April this year, * * The National Development and Reform Commission issued a notice to increase the price of natural gas pipeline transportation in some areas by 0.08 yuan per cubic meter. Subsequently, some provinces, including Hebei, raised pipeline transportation prices. The CIF price per ton of sulfur at the beginning of this year was nearly $100 higher than last year's average price. Under such circumstances, the prices of chemical fertilizer products have dropped or remained flat. The operating environment for chemical fertilizers this year is obviously worse than last year. It is understood that the insufficient operating rate of enterprises and the expansion of losses caused by high costs and poor market demand have become the main problems in the fertilizer industry. According to statistics from the Nitrogen Fertilizer Industry Association, more than 30 urea companies are currently shut down for maintenance, and the operating rate of the companies is only 76%. Four large-scale gas-head urea plants in the southwest region (with an annual urea production capacity of approximately 3 million tons) were also shut down for some reason. On the other hand, the expanded production capacity of the fertilizer industry in recent years has begun to be put into production. Nitrogen fertilizer alone added more than 17 million tons of urea production capacity from 2005 to 2009, and currently there are nearly 10 million tons of expanded capacity. From the statistics of chemical fertilizer production, we can find that from January to April this year, domestic nitrogen fertilizer production increased by 6.1% year-on-year, and phosphate fertilizer production increased by 15.6% year-on-year. It is also understood that product exports have become an important reliance on the current fertilizer industry to maintain a balance between production and demand. Although currently * During the peak season for fertilizer use restricted by domestic export policies, a large amount of fertilizers are still concentrated in export ports. Reports indicate that a total of nearly 1.5 million tons of urea products are currently waiting for export, of which more than 1.2 million tons are outside the domestic port bonded area and about 200,000 tons are inside the bonded area. At the same time, the biggest benefit of the diammonium phosphate market is also the export market. It is reported that major companies are still mainly shipping to ports. The inventory of diammonium in Fangcheng Port and Zhanjiang Port alone reaches about 800,000 tons. According to the latest estimates of the nitrogen fertilizer industry, based on the 1.2 million tons of urea exported in the first quarter, the full-year urea export volume this year is expected to exceed 5 million tons again after 2007.