When entering August, China’s Phosphate Price Index still remained at a
low level, which seems to last for long, even in the planting season, according to CCM International’s August issue of Phosphorus Industry China Monthly Report.
According to China Agricultural Means of Production Association (CAMPA),
China’s DAP plants were operating around 80%-85% of capacity in July. In view
of current low exports and slack domestic consumption, it could be foreseen
that Chinese DAP producers’ inventory might remain at a high level for poor
shipments. Consequently, domestic supply of DAP won’t be tight even in the
planting season.
In terms of the supply of raw materials, the price of phosphorus ore saw
a little slide in July. Phosphate fertilizer producers mentioned that the
enquiry from upstream phosphorus mining enterprises was increasing, leading
several phosphorus mining enterprises to cut price. However, it’s difficult to
judge whether the price of phosphorus ore is to rebound, out of the
consideration of the supply of phosphorus ore in fertilization season. Also,
DAP producers indicated that the current price of DAP was quite close to cost,
especially for those producers without phosphorus resources.
In addition, there’s a question for DAP producers: whether the price of
phosphorus ore would rise in the season of peak demand.
Relatively speaking, China’s farmers are weak in purchasing power.
Therefore, they are apt to decrease the consumption in DAP if the price rises
to an unacceptable level. Previous market situation of DAP in China witnessed
such situation. From 2010 to H1 2011, the market price of DAP was driven by rising
phosphorus ore, which gradually outpaced China’s farmer’s purchasing power.
Thus it saw a trend of decline in H2 2011. (Note: Previous market price of DAP
in China could see page 5
issue 6 Vol.2: China
Apparently, low tolerance for high price of consumers was bound to be the
prime reason why DAP producers or distributors couldn’t easily pass on the
cost.
Headlines of Phosphorus Industry China Monthly Report 1208
Phosphorus Ore
Company Dynamics: Phosphorus
mining business to bring huge profits for Sichuan Hebang
Company Dynamics: Growing
uncertainty to surround China Baoan’s new investment plan
Company Dynamics: Guizhou
Government makes up development scheme for Kailin Group
Yellow Phosphorus
Policy & Legislation: Irreplaceability
of yellow phosphorus to last for long in China
Phosphate Fertilizer
Policy & Legislation: China
to further heighten utilization of phosphogypsum
Company Dynamics: Liuguo Chemical
fails to make more profit in H1 2012
Policy & Legislation: Hubei
Government to curb local capacity expansion of fertilizer
Industry Dynamics: China’s DAP
sees limited upside for price
Fine Phosphate Chemical
Industry Dynamics: Phosphorus
investment rising in Leibo County
Company Dynamics: Hubei Xingfa to
invest new phosphate chemicals project
Import & Export
International trade situation of
phosphate chemicals in H1 2012
Price Update
Price monitor of some phosphate
chemicals in July 2012
… …
Phosphorus
Industry China Monthly Report, a monthly publication issued by CCM International on 15th of every month, provides you the latest information on company
dynamic, industry dynamic, factors impacting the price fluctuation, technology
improvement, supply & demand of China
(Guangzhou China, Aug.15, 2012)
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