Phosphate Fertilizer Weekly: Geopolitical Tensions Drive Sulfur Prices Sharply Higher; Phosphate Fertilizers Consolidate at Elevated Levels (20260612)

Contents

1. Phosphate Fertilizer Market Analysis

2. Domestic Phosphate Fertilizer Industry Operating Rates
   2.1 Domestic Monoammonium Phosphate Operating Rate
   2.2 Domestic Diammonium Phosphate Operating Rate

3. Domestic Phosphate Fertilizer Weekly Output Trends
   3.1 Domestic Monoammonium Phosphate Weekly Output Trend
   3.2 Domestic Diammonium Phosphate Weekly Output Trend

4. Domestic Phosphate Fertilizer Port Inventory Trends
   4.1 Domestic Monoammonium Phosphate Port Inventory Trend
   4.2 Domestic Diammonium Phosphate Port Inventory Trend

5. Phosphate Fertilizer Market Outlook

6. Sulfur Market Analysis

7. Domestic Sulfur Port Inventory Analysis

8. Domestic Sulfur Production Analysis
   8.1 National Sulfur Production Analysis
   8.2 East China Sulfur Production Analysis
   8.3 East China Capacity Utilization Rate
   8.4 Solid Sulfur Arrivals

1. Phosphate Fertilizer Market Analysis

Monoammonium Phosphate (MAP):

This week, China’s domestic monoammonium phosphate market remained firm and moved higher overall. On the cost side, raw material support was exceptionally strong. Overall sulfur supply remained tight, port inventories stayed at low levels, and disruptions to traffic through the Strait of Hormuz restricted international sulfur flows, driving sulfur prices sharply higher. Sulfuric acid prices fluctuated at elevated levels, while phosphate rock prices remained firm. As a result, costs continued to provide strong support for MAP, and producers showed limited willingness to reduce prices.

On the demand side, the market is currently in the traditional gap period between the end of spring planting and the start of autumn fertilizer stocking. Downstream compound fertilizer producers are operating at relatively low rates, with slow finished product sales and an extended inventory digestion cycle. Procurement is mainly limited to routine, scattered restocking based on rigid demand, while willingness for large-scale centralized purchasing remains weak. The transmission of high-priced raw materials to downstream buyers remains constrained. Factory quotations and actual delivered transaction prices have shown slight divergence, with most spot deals negotiated on a case-by-case basis.

Overall, MAP prices held at high levels this week supported by elevated raw material costs. However, demand has not shown a clear recovery, making it difficult for the market to build sustained upward momentum. In the short term, the market is likely to continue fluctuating within a narrow range at high levels. Future market direction should be closely monitored based on the pace of downstream autumn fertilizer stocking and changes in upstream raw material prices.

According to FDD data calculations, this week the average price index for 55% powdered MAP was 4,327.50, up 33.50 from last week, representing a week-on-week increase of 0.78%. The average price index for 55% granular MAP was 4,400.00, up 120.00 from last week, representing a week-on-week increase of 2.80%. The average price index for 58% powdered MAP was 4,643.33, up 50.00 from last week, representing a week-on-week increase of 1.09%.

Diammonium Phosphate (DAP):

This week, China’s domestic diammonium phosphate market continued to consolidate at elevated levels, with a wait-and-see sentiment prevailing. On the cost side, support continued to strengthen. Upstream sulfur supply tightened, while import replenishment was constrained by disruptions to international shipping, pushing sulfur prices significantly higher. Supporting raw materials such as sulfuric acid also rose accordingly, while phosphate rock prices remained firm at high levels. There was no substantial easing on the cost side, and producers showed limited willingness to reduce prices.

On the demand side, end-user fertilizer application at the grassroots level has not yet entered the concentrated procurement stage. Compound fertilizer producers are under pressure from slow finished product sales and are only maintaining scattered restocking based on rigid demand. Willingness for large-scale stocking remains low, and procurement is cautious. Insufficient downstream follow-up has limited further price increases to some extent.

Overall, the DAP market is expected to maintain a high-level consolidation pattern in the short term. Cost support and off-season demand are forming a tug-of-war. Without significant positive drivers, prices are unlikely to rise sharply, while downside room is also limited. Key factors to watch include sulfur price movements, recovery in compound fertilizer operating rates, and the start of autumn fertilizer stocking.

According to FDD data calculations, this week the average price index for 64% granular DAP was 4,405.00, unchanged from last week. The average price index for 60% brown DAP was 4,350.00, also unchanged from last week. The average price index for 57% DAP was 4,300.00, up 20.00 from last week, representing a week-on-week increase of 0.47%.

2. Domestic Phosphate Fertilizer Industry Operating Rates

2.1 Domestic Monoammonium Phosphate Operating Rate

According to FDD data, the domestic MAP industry operating rate this week was approximately 44.48%, down 0.05 percentage points from last week and down 11.09 percentage points year on year. The MAP operating rate edged down during the week and remained below the level recorded in the same period last year.

2.2 Domestic Diammonium Phosphate Operating Rate

According to FDD data, the domestic DAP industry operating rate this week was approximately 33.89%, down 2.58 percentage points from last week and down 8.86 percentage points year on year. The DAP operating rate declined during the week and remained below the level recorded in the same period last year.

3. Domestic Phosphate Fertilizer Weekly Output Trends

3.1 Domestic Monoammonium Phosphate Weekly Output Trend

According to FDD data, domestic MAP output this week was approximately 177,400 metric tons, up 0.11% from last week and down 15.56% year on year. Weekly MAP output increased slightly during the week but remained below the level recorded in the same period last year.

3.2 Domestic Diammonium Phosphate Weekly Output Trend

According to FDD data, domestic DAP output this week was approximately 164,700 metric tons, down 0.60% from last week and down 21.12% year on year. Weekly DAP output decreased during the week and remained below the level recorded in the same period last year.

4. Domestic Phosphate Fertilizer Port Inventory Trends

4.1 Domestic Monoammonium Phosphate Port Inventory Trend

According to FDD data, MAP inventories at major domestic ports stood at approximately 0 metric tons this week, unchanged from last week.

4.2 Domestic Diammonium Phosphate Port Inventory Trend

According to FDD data, DAP inventories at major domestic ports stood at approximately 29,500 metric tons this week, unchanged week on week.

5. Phosphate Fertilizer Market Outlook

MAP:

Looking ahead, the MAP market is expected to continue fluctuating at elevated levels in the short term. On the cost side, phosphate rock supply remains tight and prices continue to hold firm at high levels, providing strong cost support for MAP. Sulfur prices may still have room to rise due to international geopolitical developments and expectations of tighter resource availability, further increasing production costs.

On the demand side, downstream compound fertilizer producers are in the transition period between summer and autumn. Production demand for high-phosphorus fertilizers is gradually starting, and rigid demand for MAP procurement is expected to be released gradually. However, given pressure from finished product inventories and high raw material prices, compound fertilizer producers are likely to maintain a demand-based restocking approach with small-volume follow-up purchases. The likelihood of large-scale centralized procurement remains low.

Overall, strong cost support and moderate demand release are expected to keep MAP prices at elevated levels. However, downstream acceptance of high prices remains limited, which will also restrict upside potential. The market may remain in a high-level stalemate.

DAP:

Looking ahead, the DAP market is expected to continue consolidating with a wait-and-see sentiment. On the raw material side, sulfur prices are unlikely to decline significantly in the short term due to international geopolitical developments and tight port resources. Phosphate rock supply also remains in a tight balance, keeping production costs elevated and continuing to provide strong bottom support for DAP prices.

On the demand side, the market is currently in the traditional off-season before autumn fertilizer stocking has fully started. Downstream procurement sentiment remains cautious, and new order volumes are unlikely to increase significantly in the near term. However, as the autumn high-phosphorus fertilizer production cycle gradually approaches, some compound fertilizer producers have begun to pay closer attention to raw material reserves, suggesting the possibility of marginal demand improvement.

Overall, supported by both costs and supply, DAP prices have limited downside room in the short term, and the market is expected to remain in a high-level stalemate. If autumn fertilizer stocking demand gradually starts and raw material prices remain strong, the market may see a phased modest upward move. Going forward, attention should be paid to changes in raw material supply, the pace of autumn fertilizer demand recovery, and downstream acceptance of high prices.

6. Sulfur Market Analysis

This week, China’s domestic sulfur spot market continued its strong upward trend, with significant overall gains. Supply-demand tensions continued to intensify. After the implementation of supply guarantee policies, the tight resource situation showed no signs of easing. Meanwhile, renewed uncertainty in the international geopolitical environment pushed sulfur prices higher across regions.

By region, solid and liquid sulfur prices in Northeast China rose sharply. Market sentiment for price increases continued to strengthen, and cross-regional participation by external companies in auctions further boosted downstream purchasing enthusiasm. Regional spot prices climbed rapidly, increasing restocking pressure on downstream buyers.

In Northwest China, market prices also rose significantly. Participation in industrial and trading auctions was active. Traders and downstream buyers mainly followed up based on rigid demand, although chasing-high sentiment cooled slightly toward the weekend. Regular regional output remained stable, while some units were under maintenance, leaving spot resources relatively limited. Additional maintenance plans are expected, and supply contraction expectations continued to support the market.

In East China, the upward trend continued. The full implementation of fertilizer supply guarantee policies promoted steady downstream demand release, while regional supply tightness intensified. In addition, tensions in the Middle East restricted cargo flows, further pushing market prices higher.

The liquid sulfur market in Shandong showed a wide fluctuation pattern, falling first and then rising. At the beginning of the week, prices weakened under pressure from high levels, downstream resistance increased, and plant maintenance and production cuts led to weaker transactions. Some resource holders lowered starting auction prices to accelerate inventory reduction. After prices fell to a short-term low, low-priced rigid demand entered the market in a concentrated manner. Renewed international geopolitical uncertainty also boosted bullish sentiment, leading to a rebound from the bottom.

Overall, tradable sulfur resources at domestic ports continued to decline and approached historically low levels. Coupled with weak sulfur outbound shipments from the Middle East and ongoing global resource contraction, holders maintained a strong bullish sentiment. Market prices continued to be pushed higher amid expectations of tighter supply.

Market outlook: Domestic sulfur spot prices are expected to fluctuate at elevated levels over the coming week. The geopolitical situation in the Middle East remains uncertain, and expectations of tight tradable port resources are unlikely to ease. Holders are expected to maintain a strong willingness to hold cargo and wait for further price increases.

According to FDD data calculations, on June 12, granular sulfur at Zhenjiang Port was priced at 11,450.00, down 2.55% from the previous working day. Granular sulfur at Dafeng Port was priced at 11,430.00, down 2.56% from the previous working day. Powder/lump sulfur at Zhenjiang Port was priced at 11,400.00, down 2.56% from the previous working day. Powder/lump sulfur at Dafeng Port was priced at 11,380.00, down 2.57% from the previous working day. Solid sulfur prices in East China stood at 9,300.00, unchanged from the previous working day. Liquid sulfur prices in East China stood at 9,170.00, unchanged from the previous working day.

7. Domestic Sulfur Port Inventory Analysis

According to FDD data, sulfur inventories at major domestic ports stood at approximately 822,900 metric tons this week, down 95,500 metric tons from last week, representing a week-on-week decrease of 10.39%.

8. Domestic Sulfur Production Analysis

8.1 National Sulfur Production Analysis

This week, China’s sample sulfur output stood at 183,600 metric tons, with capacity utilization at 43.21%, down 7.89 percentage points from last week.

8.2 East China Sulfur Production Analysis

This week, sample weekly sulfur output in East China stood at 28,300 metric tons, down 12,200 metric tons from last week. Capacity utilization was 29.4%, down 12.73 percentage points from last week. East China accounted for 15% of total national weekly output.

8.3 East China Capacity Utilization Rate

According to FDD data, the domestic sulfur operating rate in East China was approximately 29.4% this week.

8.4 Solid Sulfur Arrivals

According to FDD data, solid sulfur arrivals at major ports nationwide in June are currently estimated at approximately 102,800 metric tons.