In 2013, the fertilizer market remained relatively flat during the spring season. Since the start of the season, various factors such as production capacity, inventory levels, weather conditions, and farmer sentiment have influenced the market. While supply has been adequately ensured, the overall market activity has remained subdued. According to data from the Department of Economic Affairs of the National Development and Reform Commission, the domestic markets for nitrogen and compound fertilizers have shown stability, with sufficient phosphate fertilizer supply and weak potash sales.
Recent statistical analysis indicates that urea supply and prices were relatively stable in late March, with some areas experiencing slight price declines. Given that domestic urea demand is expected to remain flat in the short term, the market is likely to maintain a stable yet fluctuating trend. Considering the fertilizer season in the northeast and southern regions, urea demand is expected to gradually recover after mid-April, potentially leading to a slight price increase, although the upward movement is not expected to be significant.
Meanwhile, the domestic phosphate fertilizer market has seen an ample supply, with overall prices remaining stable. In Shaanxi and the northeastern regions, the wholesale price of diammonium phosphate has dropped by about 50 yuan per ton, reaching 64% of its previous level. By the end of March, most winter storage orders had been fulfilled, and the grassroots market was starting to pick up. Manufacturers resumed normal operations, with an average operating rate of around 78%. As the spring planting season comes to an end, some manufacturers have begun maintenance work. The monoammonium phosphate market remains weak, with low prices and limited transactions. Most manufacturers are focused on fulfilling existing orders, and the operating rates are generally low, reflecting weak confidence among both upstream and downstream players.
In terms of demand, there is a large stock of monoammonium phosphate in certain areas, but purchasing interest remains low, resulting in light turnover. Industry forecasts suggest that in the short term, phosphate fertilizer prices will remain largely stable, with future trends depending on export performance.
Regarding potash fertilizer, the domestic market maintains a balanced supply and demand situation, though transaction volumes are relatively low and prices have been gradually declining. With increasing supply and limited demand from the downstream compound fertilizer sector, domestic demand growth is expected to remain constrained in the short term, keeping prices relatively stable.
The domestic compound fertilizer market has also shown relative stability. First, production and operations are largely normal, with enterprise operating rates rising and many companies running at full capacity. Second, sales have picked up significantly, with many companies reporting strong order fulfillment. Some small-yield compound fertilizers produced in Hunan have even led to long queues at manufacturers, indicating robust demand that is expected to last until early April. Third, the industry is transitioning from winter wheat fertilizer to summer corn fertilizer production.
It is worth noting that over the past two years, the domestic production capacity of urea, monoammonium, and diammonium phosphates has expanded too rapidly, leading to market saturation. Additionally, the recent drought in northwest and southwest China, along with slower temperature increases in the northeast, has delayed the market’s seasonal start-up, resulting in lower purchasing enthusiasm among farmers and grassroots distributors. This year, the fertilizer market has experienced steady but subdued growth.
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