Why Did Potash Price of Salt Lake Industry Ascend Apparently but Descend Actually in April?

By CnAgri2018-04-10 11:28:32 Print In February and March, 60% potash price arrival at agency’s reached 2,200 RMB/MT, however, the price in April was 2,300 RMB/MT, with an increase of 100 RMB/MT. But there was a rebate policy in April, which rules the rebate of 50 RMB/MT will be returned if 50% of task is finished; 100 RMB/MT will be returned if 70% of task is performed; 120 RMB/MT and 150 RMB/MT will be returned if 80% and 120% of task are completed. It means the lowest price of 60% potash in April was 2,150 RMB/MT, 50 RMB/MT less than the previous period. Why did potash price of salt lake industry group ascend apparently but descend actually in April?
 
The main reasons for an increase in quotations from Salt Lake Potash are great pressure of costs faced by Salt Potash Industry and a high price on international market. Salt Lake Industry’s operating revenues in 2017 stood at 11.699 billion RMB, up 12.88% from last year, but Salt Lake’s chemical business (PVC,magnesium metal, sea salt, etc.) still experienced a serious loss, so MOP business guaranteed the growth in performance of Salt Lake Industry, bearing relatively great pressure of costs; on the other hand, potash price on international market still stayed firm, of which Russian white potash increased 50 RMB/MT to 2,200 RMB from March, and at the same time, along with the end of potash contract in 2017, potash price in contracts in 2018 possibly would ascend.  
 
However, due to a fall in domestic demand and a continuous increase in supply, Salt Lake’s potash price had to descend. South is the main potash-consuming area, where the demand for potash reduces along with the ending of spring ploughing market in the south; in aspect of supply, Salt Lake Industry almost resumed production, and the daily output increased to 15,000 MT, but, in the field of ports, owing to an increase in MOP arrival, the stocks ascended to 2.3 million MT at the end of March from 1.8 million MT in early January, with a growth of 27.8%.