Phosphate Fertilizer Monthly: Strong Support at the Cost End, High Phosphate Fertilizer Prices

Analysis and Forecast of Phosphate Fertilizer Market Prices:

Analysis of Monoammonium Phosphate (MAP) Market Prices:

According to data from Feidoodoo, as of August 31, 2023, the domestic index of 55% powdered MAP is 3071.43, up 428.57 from the beginning of the month, a month-on-month increase of 16.22%. The granular index of 55% is 2820.00, down 5.00 from the beginning of the month, a decrease of 0.18%. The 58% powder index is 3266.67, up 616.67 from the beginning of the month, a month-on-month increase of 23.27%.

This month, the domestic MAP market price trend is obvious. At the beginning of the month, with the continuous rise in raw material prices, strong support was provided in terms of costs for MAP, and market quotations subsequently increased. Companies were optimistic, and many manufacturers had pending orders, resulting in a pause in quotations and sales in many places, or limiting orders, creating a favorable market atmosphere. Mid-month, as the market's available supply became scarce and many companies underwent equipment maintenance, prices rose again. At the end of the month, with many companies still pausing in their quotations and orders, the market began to sell at high prices. Some low-end sources continued to decrease, but with strong support at the cost end, the favorable conditions in the MAP market remained, and the price trend was robust.

Analysis of Diammonium Phosphate (DAP) Market Prices:

According to Feidoodoo data, as of August 31, 2023, the domestic index for 64% granular DAP is 3724.00, up 364 from the beginning of the month, a month-on-month increase of 10.83%. The 60% brown monthly average index is 3510.00, up 610 from the beginning of the month, a month-on-month increase of 21.03%. The 57% DAP index is 3312.50, up 560 from the beginning of the month, a month-on-month increase of 20.35%.

This month, the domestic DAP market price trend is also significant. At the beginning of the month, influenced by the increase in international tender prices in Bangladesh, the domestic market was greatly boosted, and prices began to show a clear upward trend. The cost side was affected by the continuous rise in raw material prices, providing strong support to the DAP market, and many manufacturers began to stop or pause quotations. Mid-month, as the available market supply tightened, traders became reluctant to sell, and with prices continuously rising, some downstream buyers became cautious. Entering the end of the month, due to persistently high upstream prices and the start of fertilization activities for some crops in the fall, there was a high demand for DAP, supporting the continued high prices of DAP, with prices showing a slight increase.

Forecast of Phosphate Fertilizer Market:

On the raw material side, the price of phosphate rock remained stable this month and is expected to continue to be stable next month. Synthetic ammonia companies currently have no stock pressure, and market demand is average. With the restart of some equipment next month, the synthetic ammonia market may see a slowdown in its rising trend, but the specific situation still requires attention to the daily output of the synthetic ammonia market next month. The sulfur market has a cautious trading atmosphere, with both supply and demand sides adopting a wait-and-see attitude. The trend is expected to be flat next month, requiring positive changes to stimulate the market. In general, with cost-side support, the phosphate fertilizer market price will fluctuate slightly next month.

On the supply and demand side, regarding supply, many phosphate fertilizer companies are currently pausing quotations and orders, dealing with pending orders and pre-received exports. The market's available supply is limited, and this situation is expected to continue in the short term. On the demand side, as the time for autumn fertilization preparation shortens, downstream demand is gradually released. The compound fertilizer market is currently booming in production and sales, traders have limited stock, and the procurement of phosphate fertilizers is active, mainly based on immediate need.

Overall, the high prices of upstream raw materials in the phosphate fertilizer market remain unchanged, with cost-side support, and downstream demand persists. With support from both sides, phosphate fertilizer prices are more likely to rise than fall.

Domestic Phosphate Fertilizer Industry Operating Status:

Operating Situation of the Domestic MAP Industry:

In August 2023, the operating rate of the domestic MAP industry was about 61.9%, a month-on-month increase of 2.91% and a year-on-year increase of 24.84%. The operating rate of the MAP industry increased slightly, higher than the same period last year. This month, many companies resumed production, and the MAP industry's operating rate increased.

Operating Situation of the Domestic DAP Industry:

In August 2023, the operating rate of the domestic DAP industry was about 62.83%, a month-on-month decrease of 3.74%, and a year-on