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Along with an Increase in Material Prices and a Wait-and-See Attitude from the Downstream, NPK Winter Reserves Have an Uncertain Outlook

China Agriculture Report By CnAgri2018-10-17 16:25:38China Agriculture Report Print
Keywords:Fertilizer MAP NPK DAP
Currently, NPK winter reserves in the northeast have started, but the progress of purchase in advance works on a general level. Material prices ascend and the companies have a limited operating rate because of the pressure from environmental departments, besides, the demand from the downstream is weak, so NPK winter reserves have an uncertain outlook.  
In terms of raw materials, influenced by urea bidding invited by India, after the National Day, urea prices increased by more 100 RMB/MT. On the current market, main quotations range at 2,100-2,300 RMB/MT; in the aspect of P-fertilizer, due to an increase in prices of materials such as phosphate rock, sulfuric acid and sulfur, MAP and DAP prices both increased by 40-50 RMB/MT compared to those in early September; in terms of K-fertilizer, the prices kept stable, but still maintained at a high level, only a slight decline in some areas, so NPK companies still have relatively high pressure of material procurement.
Along with the coming of heating, the pressure from environmental departments is increasing and the companies who are not up to standard won’t start working, so fertilizer companies in the north would maintain a relatively low operating rate. In the aspect of demand from the downstream, the plan of zero in use of fertilizer is still carried forward and dealers’ enthusiasm in storing for winter weakens, which both bring restrictions to NPK producers.   
On the one hand, fertilizer prices ascend and NPK is in a tight balance between supply and demand; on the other hand, most of NPK companies still take a wait-and-see attitude and some companies have given up the plants of starting production, so NPK winter reserves have an uncertain outlook this year.
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