Raw materials generally rise, will fertilizer prices rise after the Spring Festival?

Last week, the compound fertilizer market had a good trading atmosphere, and the operating rate of manufacturers rebounded to 60%, boosting the slight increase in upstream raw materials. As the Spring Festival is approaching, the downstream push-up effect weakens, but some companies choose to purchase before the holiday in order to maintain production after the holiday. It is expected that the fertilizer market will be in a state of high consolidation in the short term. 
Urea rebounded
Last week, the price of urea stopped falling and rose steadily. The market price in many places increased by 10~30 yuan/ton. The mainstream ex-factory quotation of urea in Shandong was 2600~2630 yuan/ton, and the mainstream ex-factory quotation of urea in Henan was 2550~2580 yuan/ton. The mainstream ex-factory quotation of urea in Hebei is 2590~2620 yuan/ton. According to the analysis of the manager Zeng of an agricultural materials company in Shandong, the fluctuation of urea has continued, and the main reason is that the social inventory is too low. He said: "At the end of October last year, when the urea dropped the most, many compound fertilizer plants did not dare to stock up, and the channel dealers also did not get the goods. The reason for this wave of rising prices is that the raw materials in the main producing areas of compound fertilizers such as Northeast China and Shandong are the first. Staged procurement, secondly, the price of upstream raw material coal has risen, and thirdly, the 'dual storage' of winter storage and summer storage is superimposed, which makes the supply of goods in the channel a little tight." In this regard, Manager Wang, the person in charge of a compound fertilizer manufacturer in Hebei, said, Most compound fertilizer manufacturers do not purchase too many raw materials when they are in short storage. In order to avoid risks, they purchase upstream raw materials according to orders. He said: "After the compound fertilizer manufacturers received downstream orders, the operating rate continued to rise. In addition to the limited production of the Winter Olympics, enterprises were worried that they would not be able to resume production on time after the Spring Festival. Therefore, the compound fertilizer manufacturers in the Beijing area must step up before the Spring Festival. production, so the raw material market was relatively prosperous in January.”
In addition, according to the reporter's understanding, some gas-headed enterprises have resumed production one after another. Under the policy of ensuring supply and stabilizing prices, the daily output is significantly higher than the same period in previous years. At this stage, the average daily output tends to be about 153,000 tons, and the overall supply continues to increase. In terms of demand, Manager Zeng told reporters that, according to previous years, the market situation during the period before the holiday should be a decrease in demand and a slight decline in prices. However, judging from the current market performance, urea manufacturers have no inventory pressure for the time being. With the support of downstream demand, they may run at high levels before and after the Spring Festival. 
In addition, according to international market news, the international urea market fell, and buyers generally began to wait and see. Last week, Brazilian buyers traded at US$600/ton CFR, and the price of natural gas has a downward trend. It remains to be seen whether the price decline will continue. 
Phosphate fertilizer prices rose slightly
Phosphate fertilizer continued the upward trend in the previous period. There are abundant orders for monoammonium phosphate and diammonium phosphate. Some enterprises have ordered orders until March, and prices remain firm. In Hubei, the ex-factory price of 55% powder ammonium is 2800~2850 yuan/ton, the ex-factory price of 64% diammonium is 3550~3600 yuan/ton, and the arrival price of 64% diammonium Heilongjiang is 3850 yuan/ton. From the perspective of downstream demand, Manager Wang told reporters: "Because the price of raw materials fluctuated in the early stage, the winter storage season in Northeast China was postponed, and compound fertilizer manufacturers were insufficient in stocking in the early stage. Since late December last year, the demand for downstream winter storage has accelerated, and many The monoammonium manufacturers have received orders until March, so they have recently suspended orders from the outside world, and the new price is definitely higher than the price paid in advance.”
In terms of diammonium, the cost support is strong, and domestic sulfur prices have been raised for several consecutive weeks. At present, the price of sulfur particles in the Yangtze River Port is 2,470 yuan / ton; the price of phosphate rock has not changed much, and the mainstream price of domestic 30% phosphate rock is 630 yuan / ton. tons or so. Manager Wang said: "The demand for blended fertilizers in some areas such as Northeast China has increased year by year, and the demand for diammonium as the main raw material for blended fertilizers has also increased year by year. At this stage, the enthusiasm for downstream procurement of diammonium has increased, and the demand will continue to increase after the Spring Festival. Continue to release."
The upper and lower pressure of compound fertilizer
Spring ploughing is the most important period of fertilizer use in a year, and the current market conditions are changing rapidly. Issues such as raw material prices, epidemics, and transportation have all caused compound fertilizer manufacturers to be under great pressure. According to industry insiders, compound fertilizer manufacturers will immediately purchase raw materials once they receive the advance payment from the downstream, so as not to fail to keep up with the market rhythm and miss the opportunity. 
In fact, the production capacity of compound fertilizers has been increasing in the last two years. The production capacity of compound fertilizers across the country is not small, but the actual operating rate of compound fertilizers is not high. Compound fertilizer manufacturers do not dare to do so until the season or when the purchased raw materials have no advantages. Production. Manager Wang said: "At present, compound fertilizer enterprises continue to recover, and the downstream market atmosphere is good. The successive rise in nitrogen, phosphorus and potassium prices is beneficial to the compound fertilizer market. In terms of price, the ex-factory quotation of 45% chlorine-based compound fertilizer is 2750~3050 yuan / ton, 45 The ex-factory quotation of % sulfur-based compound fertilizer is 3050~3250 yuan / ton. The downstream sales are mainly based on one-stop negotiation. If the manufacturer feels that the raw materials purchased in this batch have advantages, they will launch an appropriate amount of special fertilizer to stimulate downstream purchases. "In addition , Due to the good grain prices, farmers are still more motivated to plant, especially after the land transfer, the large contractors have relatively high requirements for seeds and fertilizers. Manager Wang explained: "Watering, seeds, labor, farming and other expenses are all invested in. If the output of chemical fertilizers and grains is not increased, it is equivalent to that all the inputs are ineffective, so the more scale management is carried out. Large planters have higher requirements for chemical fertilizers, and rigid demand is beneficial to the market for agricultural materials.”
For the market outlook, people in the industry generally believe that urea has the greatest impact on compound fertilizers. As the Spring Festival is approaching, enterprises should consider stockpiling raw materials to prepare for fertilizer demand after the festival. If the price of urea is too high, the company may slow down its purchases before the festival, and the price of urea may have the risk of a slight drop. It is worth noting that on January 18, Jin Xiandong, a spokesman for the National Development and Reform Commission, said that the supply of chemical fertilizers for spring ploughing this year is guaranteed, but considering the difficulty of further falling production costs, it is expected that the price of chemical fertilizers for spring ploughing may remain high. run. 
To sum up, under the condition that the social inventory continues to be low, the urea market is still sensitive, and there may be a loosening and declining situation before the holiday. It is expected that the market will still run at a high level in February; there is no sales pressure for phosphate fertilizer enterprises, and the market will continue to stabilize and rise after the holiday; The downstream peak season demand for compound fertilizer is approaching, and the raw material market fluctuates greatly. Enterprises are preparing for price adjustments to prepare for post-holiday sales. In the later period, it is necessary to continue to pay attention to the operating rate of enterprises before and after the holiday, the trend of upstream raw materials, social inventory, changes in the epidemic situation and the trend of international market conditions.