Summary Post on the Market Conditions and Prices of Compound Fertilizers in November 2016

Compound fertilizers: A key component of winter fertilizer storage. Here, dawn breaks quietly... Author/Source: China Agricultural Inputs Media. Date: November 1, 2016. Page views: 1. It has been some time since the autumn fertilization season ended. Farmers remain relatively unenthusiastic about planting crops; they tend to opt for cheaper fertilizers. As a result, sales of fertilizers produced by small manufacturers are on the rise, while branded fertilizers are facing significant setbacks. As the payment receipts from dealers are arriving later than in previous years, they are very cautious when it comes to winter stockpiling. 　　Sales of diammonium phosphate are expected to be strong in certain areas. The price of diammonium phosphate is also low this year, and farmers in some regions are switching from compound fertilizers to diammonium phosphate when applying fertilizers in the fall. Hui Runjun from Shaanxi Sanyuan Huifeng Agricultural Supplies Co., Ltd. said, “The main crops grown in the area are corn and wheat. Due to low grain prices, farmers are not very enthusiastic about growing grains. 80% of the farmers hope for high yields, while 20% don’t care much about the yield as long as the land remains cultivated.” It is for this very reason that, seeing the farmers reduce their spending on agricultural inputs, dealers reduced their stock levels during the early stages of autumn procurement, which even led to shortages in some areas. ” 　　Regarding the bullish outlook for the sales of diammonium phosphate in the local market, Hui Runjun explained to reporters: “Starting from mid-to-late August, the prices of diammonium phosphate began to decline. The ex-factory price for 57% diammonium phosphate is 1,900–2,000 yuan per ton. We believe that farmers will make more selective choices during the autumn, so based on this trend we adjusted our inventory levels and stocked up more diammonium phosphate in advance.” In fact, there is indeed strong demand for diammonium this season, a phenomenon that has not occurred in previous years. ” 　　Unfair competition leads to market chaos. Cheng Zhaolong from the Nongdeli Fertilizer Distribution Center in Qufu City, Shandong Province, said, “Last winter, local fruit trees suffered significant damage; as a result, farmers drastically reduced the amount of fertilizer they applied to their trees.” ； Coupled with low grain prices, the purchase price of corn is 0.7 yuan per jin, which reduces farmers’ enthusiasm for growing grain ； Although the area dedicated to potato cultivation locally is increasing year by year, the quality of fertilizers used by farmers remains poor; fewer farmers are opting for branded fertilizers. ”There is another reason for the impact on branded fertilizers: the influx of counterfeit and substandard products. 　　Cheng Zhaolong said that this year has been the most chaotic for the downstream market; small manufacturers have seen explosive growth, and their fraud tactics are sophisticated. Farmers’ focus on price rather than quality contributes to fraud, and he hopes that relevant law enforcement agencies will enforce regulations strictly to ensure the healthy development of the market. When talking about the transaction patterns, he said helplessly, \"Credit sales to downstream customers are still too widespread; collections have been slow this year. One reason is the low price of grain, as farmers haven’t sold their grain yet, and another reason is that the workers haven’t returned, so payments aren’t made until the end of the year.\" ”In this regard, Hui Runjun also said, “In previous years, the repayment rate downstream was 70% before October. However, this year, the repayment timeline has been delayed, mainly due to the unpredictable weather conditions locally. There was a drought during the sowing period earlier on, and now it’s raining during the grain-selling season; as a result, many tasks cannot be carried out.” ” 　　The start of winter storage is progressing slowly. The meeting on phosphate-based fertilizers is approaching, and in private, dealers consider this to be a signal that winter storage is about to begin; however, this year dealers have low expectations regarding this. Cheng Zhaolong said, “Regarding urea, since its price remains low throughout the year, it is likely that no one will stockpile urea for winter use. As for compound fertilizers, we’ll have to wait and see after the policies regarding winter stockpiling are announced.” ”Hui Runjun said, “Nowadays, people are more cautious when it comes to winter stockpiling. The purpose of such stockpiles is to handle emergencies and to prevent shortages of resources.” ； Secondly, there is a certain level of profit; currently, there is no price difference in stockpiling, nor any profit, so distributors are unwilling to stockpile goods – this is a normal reaction in the market. Current operations are focused on speed and efficiency, as the market supply exceeds demand and there is no shortage of resources; payments can be made at any time and deliveries will occur promptly, unless there are specific policies in place. However, manufacturers’ prices have now reached their lowest level, leaving them with limited room for discounts. ”

Monthly Review of Phosphorus Ore in October: Stable Market Trends Author/Source: Date: 2016-11-01 Clicks: 1 I. Overview of the Domestic Phosphorus Ore Market In October, the domestic phosphorus ore market maintained stable trends, with no significant fluctuations. Companies tend to adopt a wait-and-see attitude, with few new orders; they rely mainly on previous orders and existing customers for shipments, and the prevailing price in the phosphate rock market remains stable. 　　Conditions in the main production areas in October: In the Fuquan and Weng’an regions, the ex-works price (including tax) at the Macangping railway station for phosphate rock with a 28% grade was 285 yuan per ton; for phosphate rock with a 30% grade, the price was 315 yuan per ton. In the Guiyang area, the ex-works price of phosphate rock with a 30% grade is 300 yuan per ton. In Hubei region, the price at the mine entrance for phosphorus ore with a purity of 20% is 100–110 yuan per ton. The price for phosphorus ore with a purity of 28%, delivered on board ships, is around 340–350 yuan per ton. Phosphorus ore with a purity of 29% has a delivery price of 370 yuan per ton, while ore with a purity of 30% costs 400 yuan per ton. The ex-mine price of phosphorus ore with a purity of 27% in the Leibo area, including taxes, is 190 yuan per ton, while that for phosphorus ore with a purity of 28% is 220 yuan per ton ； The delivery price at the county town for phosphorus ore with a purity of 26% is 190 yuan per ton (including taxes); for ore with a purity of 27%, the price is 210 yuan per ton. The delivery price at the county town for ore with a purity of 28% is 230 yuan per ton. Some mining companies charge 355 yuan per ton for ore with a purity of 28% when shipping it to Hubei. In Yunnan region, the ex-warehouse price of phosphorus ore with a purity of 22%-23% is 230 yuan per ton including taxes; the price at the mine site for phosphorus ore with a purity of 28% is 280-300 yuan per ton. The price at the mine site for phosphorus ore with a purity of 29% is 340-350 yuan per ton, while the price at the mine site for phosphorus ore with a purity of 30% (excluding taxes) is 420 yuan per ton. 　　II. Statistics on Phosphorus Ore Imports and Exports In September 2016, the export volume was 26,100 tons, the export value was 2.79 million US dollars, and the average monthly export price was 107 US dollars per ton. 　　III. Market Outlook The domestic phosphate fertilizer market has remained sluggish this month, with some companies delaying their production plans. The downstream phosphate fertilizer market is unlikely to see any improvement in its sluggish trend, and prices will remain stable at low levels. It is expected that the phosphate rock market will continue to show stability in the short term. (China Agri-Media)

There is an oversupply in the market; there won’t be any shortage of resources

October Phosphorus Ore Monthly Review: Stable Market Trends Author/Source: Date: 2016-11-01 Clicks: 18 I. Overview of the Domestic Phosphorus Ore Market In October, the domestic phosphorus ore market maintained stable trends, with no significant fluctuations. Companies tend to adopt a wait-and-see attitude, with few new orders; they rely mainly on previous orders and existing customers for shipments, and the prevailing price in the phosphate rock market remains stable. 　　Conditions in the main production areas in October: In the Fuquan and Weng’an regions, the ex-works price (including tax) at the Macangping railway station for phosphate rock with a 28% grade was 285 yuan per ton; for phosphate rock with a 30% grade, the price was 315 yuan per ton. In the Guiyang area, the ex-works price of phosphate rock with a 30% grade is 300 yuan per ton. In Hubei region, the price at the mine entrance for phosphorus ore with a purity of 20% is 100–110 yuan per ton. The price for phosphorus ore with a purity of 28%, delivered on board ships, is around 340–350 yuan per ton. Phosphorus ore with a purity of 29% has a delivery price of 370 yuan per ton, while ore with a purity of 30% costs 400 yuan per ton. The ex-mine price of phosphorus ore with a purity of 27% in the Leibo area, including taxes, is 190 yuan per ton, while that for phosphorus ore with a purity of 28% is 220 yuan per ton ； The delivery price at the county town for phosphorus ore with a purity of 26% is 190 yuan per ton (including taxes); for ore with a purity of 27%, the price is 210 yuan per ton. The delivery price at the county town for ore with a purity of 28% is 230 yuan per ton. Some mining companies charge 355 yuan per ton for ore with a purity of 28% when shipping it to Hubei. In Yunnan region, the ex-warehouse price of phosphorus ore with a purity of 22%-23% is 230 yuan per ton including taxes; the price at the mine site for phosphorus ore with a purity of 28% is 280-300 yuan per ton. The price at the mine site for phosphorus ore with a purity of 29% is 340-350 yuan per ton, while the price at the mine site for phosphorus ore with a purity of 30% (excluding taxes) is 420 yuan per ton. 　　II. Statistics on Phosphorus Ore Imports and Exports In September 2016, the export volume was 26,100 tons, the export value was 2.79 million US dollars, and the average monthly export price was 107 US dollars per ton. 　　III. Market Outlook The domestic phosphate fertilizer market has remained sluggish this month, with some companies delaying their production plans. The downstream phosphate fertilizer market is unlikely to see any improvement in its sluggish trend, and prices will remain stable at low levels. It is expected that the phosphate rock market will continue to show stability in the short term. (China Agri-Media)

Another phosphorus-related meeting, again in Greater Nanjing. Author/Source: China Agri-Materials. Date: 10-31-2016. Clicks: 22. In September this year, there were numerous unusual jokes; people made sarcastic remarks such as “If you go through military training, it will be a sunny day,” “What’s black in front of you isn’t really black, and what you call white isn’t really white.” There were also jokes like “Congratulations – your face is now so dark that only your big eyes are visible; all that’s left is a crescent moon.””； With clear and crisp responses, it said, “Your coming to this meeting is like a thunderbolt.” “The drink we’re drinking now isn’t real wine; only the wine served at these meetings truly qualifies as fine wine.” “There’s nothing important to test in the agricultural supplies industry this year, so people are busy attending various meetings.”… In September, the date and location for the “17th National Conference on the Production and Sales of High-Concentration Phosphorus Fertilizers” were finalized, and it would once again be held in Nanjing. When I received the WeChat screenshot notification that morning, I was completely upset; I could imagine spending every day in a drunken stupor, existing like a scarecrow without any soul. 　　Major fertilizer types such as urea, ammonium phosphate, potassium chloride, and compound fertilizers have all reached new low prices over the past five years. While compound fertilizers and newer types of fertilizers still generate profits, nitrogen and phosphate fertilizer manufacturers are facing severe difficulties. In the past, people in the agricultural supplies industry would talk about how to live a good and fulfilling life, but now some people ask how to survive without going out of business. Over the years, many in this industry, especially those involved in compound fertilizer production, had complaints about the annual phosphorus-compound fertilizer conferences that have been held since 2000. This year, however, it seems that the attitude has changed, and there is no longer such resentment. 　　Stating that it aims to help Chinese agricultural input professionals overcome difficulties and break out of their predicaments, thereby promoting the sustainable and healthy development of the industry, the China Phosphate and Compound Fertilizer Industry Association and the China Agricultural Means of Production Circulation Association—which has just been rated as a 4A-level national industry association or chamber of commerce—have jointly established a platform for “communication, sharing, mutual benefit, and cooperation”: the 17th Domestic High-Concentration Phosphate and Compound Fertilizer Production and Marketing Conference. Scheduled to be held in Nanjing from November 4th to 6th, the 2016 China Phosphate and Compound Fertilizer Industry Exhibition will take place concurrently. When he heard the location of the meeting, as mentioned earlier, his initial attitude wasn’t very good. After being given \"earnest advice,\" \"sarcastic comments,\" and \"affectionate remonstrances\" by his friends, he fully realized his mistakes and resolved to be a great host. At the dinner table, we’re all brothers – can you see the slow motion movement in my left hand and also in my right hand? 　　A few days ago, it was reported at the China International Fertilizer Market Forum that from January to August this year, the national nitrogen fertilizer output reached 30.986 million tons. Among this, the physical output of urea was 47.045 million tons, a year-on-year decrease of 1.5%. The topic that received the most attention and was brought up most frequently by readers: In August, the average ex-factory price of urea was 1,172 yuan per ton, a decrease of 419 yuan per ton compared to the same period last year ； From January to August this year, the cumulative ex-plant price of urea was 1,279 yuan per ton, a decrease of 350 yuan per ton compared with the previous year. The main revenue from nitrogen fertilizer sales in 8 months amounted to 147.86 billion yuan, a 14.7% decrease compared to the previous year. Out of 283 nitrogen fertilizer manufacturers, 147 suffered losses, with those losses totaling 10.35 billion yuan, an increase of 3.64 billion yuan on a year-on-year basis. The entire industry suffered a net loss of 7.41 billion yuan, which is 14.4 times the loss amount in the same period last year; in other words, there was a loss of nearly 1 billion yuan per month! After reading this sad news, I sent a joke to agricultural industry professionals in 6 provinces and cities: \"The ‘Economic Blue Book Summer Edition: China’s Economic Growth Report (2015–2016)’ published by the Institute of Economics of the Chinese Academy of Social Sciences, the **Finance and Development Laboratory, and Social Sciences Academic Press states that ‘more than half of China’s provinces are in the fourth stage of economic development, with per capita incomes ranging from $6,000 to $11,000, placing them in the upper-middle income category.’\" ‘Some provinces have experienced rapid economic growth; they have successfully crossed the income threshold of the fifth stage and entered the later phase of industrialization, becoming provinces with a higher level of development. Six provinces in China have entered the fifth phase, namely Tianjin, Beijing, Shanghai, Jiangsu, Zhejiang, and Inner Mongolia. ”Indeed, out of more than 20 friends from 6 provinces and municipalities this time, not a single one replied to me with “hehe” or “I’m holding you back”. Almost all of them responded like this: “Definitely a joke”; “What a hilarious joke”; “It’s the funniest thing I’ve heard since I started working in the agricultural supplies industry”; “I belong to the high-income group; yet even a few packs of spicy strips are beyond my budget”; “There’s nothing wrong with that—they said **belongs to the upper-middle-income group**, but they didn’t say you yourself are in that category”; “I dislike being labeled as part of the high-income group; my name is Red Scarf”; “Are the benefits meant for my beloved Jiangsu going to be distributed to those less developed neighboring provinces?” ”““It’s another prelude to the college admission quotas.” “Blow, blow, my pride runs wild; blow, but you can’t destroy my pure garden…” This is our group of adorable agricultural input “Smurfs”. They’re lively and smart, mischievous yet clever. They came to Nanjing freely to attend the Phosphate and Compound Fertilizer Conference. Working together, they racked their brains and successfully overcame the “slump in the agricultural inputs industry”. 　　In the first three quarters of this year, 5.57 million tons of various mineral fertilizers and chemical fertilizers were imported, with an import value of 1.74 billion US dollars ； In the first three years, 19.39 million tons of mineral fertilizers and chemical fertilizers were exported, generating export revenues of $4.772 billion. Given these figures, it’s evident that the export value has decreased by nearly 40%. This reminds me of a banner hanging in a middle school in Dali, Yunnan: “I reflect on myself three times a day: Am I doing well enough?” Rich or poor? Is it handsome? No! Go learn*! ”It’s quite inspiring; every time I think of this banner, I take a minute to reflect before continuing to use my phone. \"Agricultural supplies professionals should examine themselves three times a day: Can I do other things as well?\" Can it do other things? Can it do other things? No! Go sell fertilizer! ”. 　　“Isn’t it delightful to have friends come from afar? Bro Kun, I’m here! ”……Just now, I received a few more messages with similar content. It is said that last year’s phosphate fertilizer conference in Xi’an was packed with people; over 200 companies competed to participate, there were more than 700 exhibition booths, and over 40,000 visitors. One after another, different parties took turns to showcase their offerings – it’s time for those in the agrochemical industry to make their mark. I said last year that \"the production and sale of phosphate fertilizers do bring direct economic benefits to the host city in terms of transportation, tourism, accommodation, and dining – it truly lives up to its name.\" At the end of September, when I helped someone book a hotel room, the prices were quite reasonable ； A few days ago, while helping Sister Yang Chunhua, whom I have always admired, book a room, I realized that all the hotels with some reputation within a kilometer of the convention center were fully booked – there were no available rooms in standard rooms, business rooms, or any other type of suite ； Only then did I realize that there were hotels with just one large bed (1.5m) available, and it was explicitly stated that no extra beds could be provided ； Only then did I learn about the Candy Hotel; normally it costs 198 yuan per day, but during the phosphate fertilizer conferences it costs 700-800 yuan per day ； Only then did I realize... Enough about that. Let’s say the Nanjing conference is an industry event of larger scale, greater international scope, wider influence, and a more comprehensive range of presentations. Then let’s raise our glasses, have a brief chat for five minutes, and enjoy a lively celebration for two hours. Organizing committee, maybe next year’s phosphorus compound fertilizer conference can also be held in Nanjing? (Kun Ge)

The market price of diammonium phosphate saw a slight decline. Author/Source: Date: November 2, 2016. Click-through rate: 2. http://www.nzdb.com.cn/u/cms/www/201611/tjmc02094408.png http://www.nzdb.com.cn/u/cms/www/201611/ptdp02094409.png Last week (October 24–28), the progress of winter stockpiling was slow, and the market price of diammonium phosphate declined slightly. On October 31, China’s Phosphoric Acid Diammonium Wholesale Price Index (CPPI) was 2464.86 points, down 19.96 points on a month-on-month basis, representing a decline of 0.80% ； A decrease of 502.33 points on a year-on-year basis, representing a decline of 16.93% ； It dropped by 756.91 points from the base period, representing a decline of 23.49%. On October 31, China’s Phosphoric Acid Diammonium Retail Price Index (CPRI) was 2756.33 points, down 7.89 points on a month-on-month basis, representing a decline of 0.29% ； It dropped by 618.59 points from the base period, representing a decline of 18.33%. 　　Supply situation: Last week, most DAP producers focused on fulfilling prior advance orders, with only small quantities shipped at provisional prices. Many downstream users are pessimistic about the future market, while companies are inclined to maintain high prices; as a result, the overall market is in a state of stalemate with modest sales volume. In terms of raw materials, the supply and demand situation in the sulfur market has improved slightly, with domestic sulfur prices rising modestly ； The market conditions for phosphate rock remain stable, and costs provide limited support for the price of diammonium phosphate. Last week, the average operating rate of domestic DAP producers was approximately 46.18%, showing a slight decline from the previous week. 　　Demand situation: Demand both domestically and internationally is weak, making it difficult to provide strong support for manufacturers to increase production volumes. The domestic market is driven primarily by winter storage needs, but dealers are currently reluctant to stock up, resulting in a slow start to winter storage activities. In the international market, as India still has no demand for purchases, Pakistan’s demand has become the key focus. China’s exports to Brazil have declined significantly, with prices continuing to fall, mainly due to fierce competition from Morocco and Russia in those markets. 　　International market: The international market price for DAP continues to decline. The FOB price at the Port of Tampa, USA, is $321–326 per ton; both the higher and lower ends of the price range have decreased by $5 per ton compared to the previous week ； The FOB price in Tunisia is $346–351 per ton, with stable prices ； The FOB price in Morocco is $339–356 per ton, with no changes for now ； The FOB price for the Baltic/Black Sea region stands at $321-$326 per ton, remaining stable ； In China, the FOB price is $296–301 per ton, with both the high-end and low-end prices dropping by $2 per ton (same issue as before?) ). 　　Domestic market: According to data monitored by the association, last week prices of diammonium phosphate in the 21 provinces under observation remained stable or declined slightly. Among them, the prices in Shandong, Henan, Gansu, and Xinjiang all showed a downward trend, with declines ranging from 50 to 484 yuan per ton; Shandong had the largest decline ； Prices in the remaining provinces remained stable. 　　A conference on phosphate fertilizers is upcoming, so some industry players are adopting a wait-and-see attitude, hoping for clear guidance after the conference. International market demand is also sluggish. It is expected that the market will remain weak in the short term, with consumers remaining cautious in their purchasing decisions. (China Agri-Materials News Network)

Analysis of phosphate rock: Market conditions for phosphate rock in Sichuan region. Author/Source: Date: 11-02-2016. Clicks: 15. In the Sichuan region, the price of phosphate rock with a purity of 27% at the mine site, including taxes, is 190 yuan per ton, while phosphate rock with a purity of 28% costs 220 yuan per ton at the mine site. In Mabian, phosphate rock with a purity of 26% costs 190 yuan per ton when delivered to the county town (including taxes); phosphate rock with a purity of 27% costs 210 yuan per ton, and that with a purity of 28% costs 230 yuan per ton. Some mining companies sell phosphate rock with a purity of 28% to Hubei at 355 yuan per ton. In the phosphate rock market, operating rates remain low; most producers are fulfilling prior orders, while new order volumes are scarce. It is expected that the phosphate rock market in Sichuan will remain stable in the short term. 　　The Southern Mine in Mabian, Sichuan, supplies phosphorus concentrate of 30%-32% quality, primarily to areas within Sichuan and Hubei. The concentrate of 31% quality is priced at 350 yuan per ton when delivered at Mabian county town, and at 400 yuan per ton when shipped by train; the concentrate of 32% quality costs 365 yuan per ton at the warehouse in Mabian, and 415 yuan per ton when shipped by train. Prices remain stable for now, with deals being negotiated on a case-by-case basis. (China Agri-Media)

What’s the situation with winter storage of phosphate fertilizers? Author/Source: Agri-Materials Guide Date: 2016-11-03 Clicks: 1 At present, the rigid demand from users in the autumn period has largely ended; winter stockpiling is progressing very slowly, the market is sluggish, and there is a strong atmosphere of caution. The ammonium market is under pressure, but it is also supported by rising costs, leading to a slight increase in prices. The situation regarding winter stockpiling remains unclear, with most companies waiting to see what happens at the phosphorus compound fertilizer production and sales conference. 　　Monoammonium: The domestic monoammonium market remains stable; many enterprises in Hubei have halted production, resulting in a significant reduction in supply in the coming period. Starting in November, Linyi will once again carry out measures to address air pollution; fertilizer manufacturers and industries with excess production capacity will be subject to restrictions, with production limits lasting up to 120 days. This will have a severe impact on the winter storage operations of compound fertilizer companies in Linyi. 　　Inventory of monoammonium in the market is limited; some compound fertilizer manufacturers have shown signs of inquiring about prices, with a more proactive purchasing attitude compared to before. Together with rising sulfur prices and transportation costs, these factors supported the cost of monoammonium, resulting in a slight increase in the price at the delivery site. According to monitoring, last week the average ex-plant price of 55% powdered monoammonium was 1,520 yuan per ton (price per ton, the same below), representing a 0.33% increase on a month-on-month basis ； The average wholesale price is 1,635 yuan, remaining unchanged on a month-on-month basis. 　　Diammonium: The domestic market for diammonium is sluggish, and with little optimism regarding demand for winter storage in the industry, downstream users are reluctant to stock up and are waiting to see how things develop. Despite factors such as rising costs that could have supported prices, the price of diammonium phosphate did not increase. The author believes that further positive factors are needed to boost the market; in addition to companies reducing production to maintain prices, the cooperation of distributors is also essential. Careful purchasing by distributors can help mitigate some risks; however, if purchases are made in a steady manner, it is possible for the prices of diammonium phosphate for winter storage to rise as well. Last week, the average ex-plant price of 64% diammonium phosphate in the domestic market was 1,975 yuan, while the average wholesale price was 2,250 yuan – both figures remaining unchanged from the previous week. 　　International 　 International phosphate fertilizer prices are declining steadily. Currently, Pakistan remains the most active market in the world; local buyers have recently purchased 210,000 tons of diammonium phosphate, and import demand is expected to slow down. Foreign media reports indicate that the Chinese market is weak; the FOB price for several types of diammonium phosphate available in China is 300 dollars, while the FOB price for small-scale transactions of such products in China to Southeast Asia ranges from 305 to 310 dollars. (Hu Xiaoshan)

Nitrogen, phosphorus, and potassium prices are all rising, leading to an increased tendency among manufacturers of compound fertilizers to raise prices. Author/Source: JinYinDao. Date: 11-02-2016. Clicks: 12. Since October, the price of urea has been on an upward trend; currently, the price in Shandong for small-grained urea is between 1330–1350 yuan per ton, which represents an increase of around 160 yuan per ton compared to the beginning of October； Since late October, the prices of low-end phosphate fertilizers have declined; in regions such as Hubei, prices have tried to reach levels 20-30 yuan/ton higher. Currently, the actual selling price of 55% phosphate powder in Hubei is between 1530-1560 yuan/ton. At the end of October, potash fertilizers showed no sign of weakness; driven by price increases from Sinograin and Sinochem, port prices rose by 20-30 yuan per ton. Together with the adjustment in road freight costs, the price of compound fertilizer raw materials at the supplier’s location has risen significantly compared to before. 　　Due to the generally poor pre-orders for winter stockpiling this year, as well as frequent fluctuations in raw material prices, compound fertilizer manufacturers have been reluctant to stock up on raw materials for winter use; so far, some have only secured one-third of the amount needed for winter stockpiling, and for certain types of raw materials, no purchases have yet been made. This means that as raw material prices rise, the cost of purchasing compound fertilizers will gradually increase ； As costs rise, compound fertilizer companies are more inclined to hold their prices. Since last week, there have been signs of a decline in the low prices mentioned in the initial tentative quotes; in some cases, attempts were made to quote higher prices of 30 yuan per ton. 　　Looking at the root causes of this rise in raw material prices, it is mainly driven by cost factors. Urea prices are primarily driven by the sharp rise in coal prices; according to statistics, the Bohai Rim thermal coal index rose by 32 points in October, which significantly increased the costs of coal-based chemical products. Previously, urea producers had already incurred significant losses. According to data from the ** Bureau of Statistics, from January to August, the main business revenue of the nitrogen fertilizer industry amounted to 147.86 billion yuan, a year-on-year decrease of 14.7% ； The entire industry posted a net loss of 7.41 billion yuan, which is 14.39 times the loss recorded in the same period last year ； There are 283 nitrogen fertilizer enterprises; among them, 147 are operating at a loss. This represents an increase of 24 loss-making enterprises compared to the previous year. The overall loss rate in the industry stands at 51.9% ； The losses incurred by loss-making enterprises amounted to 10.35 billion yuan, an increase of 3.64 billion yuan or 54.2% compared to the same period last year. This sharp rise in coal prices has, in turn, driven up the prices of urea manufacturers. Ammonium monophosphate is primarily driven up by rising sulfur prices. Reportedly, sulfur prices have been trending upward since late September. As of November 1, the actual transaction price for imported bulk granular sulfur in the coastal areas along the Yangtze River rose to 900 yuan per ton, an increase of 180 yuan per ton. This has consequently led to a significant rise in the cost of monoammonium phosphate. 　　Looking at the future trend, coal and sulfur are likely to continue to rise slightly, providing strong support for the costs of nitrogen fertilizers and phosphate fertilizers. Following the phosphate and compound fertilizer conference, major compound fertilizer manufacturers will successively hold ordering meetings and announce new policies and prices for winter inventory accumulation. It is expected that, supported by cost factors, these companies will be more inclined to maintain stable prices ； However, considering the acceptance capacity on the downstream side and the intense market competition, the extent of overreporting is expected to be somewhat curbed. Particular attention should be paid to the contents of the winter storage policies of major compound fertilizer enterprises. (Xu Shuxian)

Diammonium phosphate: What’s holding back its price increase? Author/Source: China Fertilizer Network Date: November 3, 2016 Page views: 15 Recently, most chemical industries have seen a wave of price increases. The fertilizer market has also been somewhat influenced by this trend, with prices starting to rise. For instance, since mid-October, driven by three factors—rising coal prices, increased transportation costs, and relatively low overall production levels—the prevailing price in Shandong Province has climbed to 1,350 yuan per ton； Following two major events—environmental-related production cuts and a rapid rebound in sulfur prices—the price of monoammonium phosphate has also risen. Currently, in Hubei Province, the prevailing ex-factory price for 55% powdered monoammonium phosphate has climbed to around 1,600 yuan per ton. Due to these environmental restrictions, some manufacturers are currently limiting their order intake; as a result, market control has shifted hands within just one month ； Potassium fertilizer is also seeing some activity. Due to good sales during the earlier period of low prices, the volume of imported potassium chloride via border trade has been relatively high. However, recent arrivals have been somewhat insufficient. Additionally, with the rapid depreciation of the RMB, traders are no longer making any profit at previous selling prices. Both prices and sales methods have therefore been adjusted accordingly. Currently, the prevailing port quotes for 62% white potassium chloride have risen to 1,630–1,650 yuan per ton; the previous discount margins have essentially disappeared. There is a strong speculative atmosphere in the port market, with local prices having increased by 20–30 yuan per ton compared to earlier levels. Moreover, extremely low-price offerings are gradually vanishing ； In just half a month, the markets for nitrogen, phosphorus, and potassium have all seen price increases. 　　However, the current price trend of DAP has left many industry insiders puzzled. Firstly, most DAP producers have suspended or limited production to varying degrees; thus, the supply pressure is not significantly higher than that for other types of fertilizers ； Secondly, the port price of sulfur, the raw material in granular form, has risen slightly from 700 yuan per ton earlier on to 900 yuan per ton at present. The prices of liquid ammonia and phosphate rock have shown relatively stable fluctuations in the short term, and the cost of pure raw materials is not inferior to that of other types of fertilizers. However, while the prices of most fertilizers and seed products in the domestic market are rising sharply, the price of diammonium phosphate remains stable. The author discussed this issue with several companies that produce diammonium phosphate, and the findings were as follows: First of all, demand has not yet started to increase. The fertilizer varieties whose prices have risen above mention share one common feature: they can all be used as raw materials for the production of compound fertilizers. The demand for these raw material fertilizers starts earlier than the sales of finished fertilizers. Based on the usual timing in previous years, downstream distributors begin to purchase diammonium phosphate only after the meetings related to phosphorus-based compound fertilizers; at present, there is not enough trading volume to support an increase in diammonium phosphate prices. 　　Secondly, price adjustments may encourage some dealers to adopt a more cautious attitude. In the past two years, the situation regarding the winter storage of chemical fertilizers in China has been characterized by price increases during the off-season and declines during the peak season. Due to heavy losses in the previous two years, many distributors are cautious; with the exception of a few fertilizer mixing plants in the Northeast that are forced to make purchases due to demand, most distributors choose to stay out of it. If the price of diammonium phosphate rises before the phosphorus-based fertilizer conferences, it will suit those distributors who are overly cautious – after all, if prices rise, it’s likely that there will again be price increases during the off-season and decreases during the peak season. 　　Finally, there is concern about a return of goods to the ports. Since export tariffs remain at the same rate throughout the year regardless of peak or off-peak seasons, domestic market prices are subject to constraints imposed by export prices. At present, there is a relatively tight balance between port prices and domestic market prices; if domestic market prices are adjusted abruptly, given that the international market is still weak, it is possible that the goods in the hands of some port traders may flow back. 　　In summary, the price of diammonium phosphate was supposed to rise, but due to various complicating factors, the timing of this increase had to be postponed. However, most companies believe that an increase in the price of diammonium phosphate is likely in the future; the extent of such an increase will still depend on the production capacity of domestic diammonium phosphate manufacturers. If things are managed properly, the possibility of a decline in diammonium phosphate prices by the beginning of next year will also be relatively low. (Wu Wenchao)