Phosphate Weekly: Demand Collapse Probes the Bottom, Weakness Persists (20261016)

1. Phosphate Fertilizer Market Analysis

1.1 Phosphate Fertilizer Market Price Analysis

Monoammonium Phosphate (MAP):

This week the domestic MAP market continued its overall weak downward trend; on-floor trading sentiment was light, new spot orders were limited, and room for negotiation on firm bids widened somewhat. On the cost side, the upstream phosphate rock, sulfur, and sulfuric acid markets were overall weak, and their support for MAP continued to weaken. On the demand side, autumn-fertilizer application is gradually wrapping up, compound fertilizer enterprises are shipping finished goods poorly and operating rates remain low, raw material procurement stays on rigid-demand follow-through with buy-as-you-go, there has been no large-scale concentrated restocking, grassroots winter storage has not yet fully started, and market wait-and-see sentiment is fairly heavy. Overall, costs are moving lower but remain at a relatively high level and still provide some floor; however, the drag from weak downstream demand is more prominent, and MAP is likely to run weak and range-bound in the short term. Going forward, focus on raw material price trends, downstream compound fertilizer operating rates, and the pace of winter-storage stocking.

According to FDD data estimates: this week, the average price index for 55% powder was 3,751.25, down 52.08 from last week, a week-on-week change of -1.37%; the average for 55% granular was 4,050.00, down 233.33, a week-on-week change of -5.45%; and the average for 58% powder was 4,323.33, down 26.67, a week-on-week change of -0.61%.

Diammonium Phosphate (DAP):

This week the domestic DAP market maintained a weak, stalemated pattern; on-floor trading pace was likewise weak, list prices held firmer than MAP, but room for negotiation on firm bids widened and follow-through on new orders was insufficient. On the demand side, domestic autumn-seeding fertilizer application is gradually entering its closing stage and grassroots farmer procurement is trending lower; compound fertilizer enterprises are shipping finished goods poorly, raw material procurement stays on rigid demand with buy-as-you-go, bulk purchasing is limited, the winter-storage market has not yet substantively started, and participants' wait-and-see sentiment is fairly heavy. On the cost side, the upstream phosphate rock, sulfur, and sulfuric acid markets ran weak and range-bound, and their cost support for DAP weakened marginally. Overall, costs at year-on-year highs still provide some bottom support, but the drag from weak terminal demand is strong, wait-and-see sentiment on the floor is thick, and the DAP market is likely to run weak and range-bound in the short term. Going forward, focus on upstream raw material trends, the pace of the grassroots autumn-fertilizer close-out, and the progress of winter-storage stocking.

According to FDD data estimates: this week, the average price index for 64% granular was 4,591.67, down 20 from last week, a week-on-week change of -0.43%; the average for 60% brown was 4,170.00, down 196.67, a week-on-week change of -4.50%; and the average for 57% DAP was 4,012.50, down 125.00, a week-on-week change of -3.02%.

1.2 MAP Product Price Comparison

MAP Market Price (yuan/t)

1.3 DAP Product Price Comparison

DAP Market Price (yuan/t)

2. This Week's Domestic Phosphate Fertilizer Plant Dynamics

Overview of Domestic Phosphate Fertilizer Enterprises' Maintenance This Week

3. Domestic Phosphate Fertilizer Industry Operating Rates

3.1 Domestic MAP Industry Operating Rates

According to FDD data statistics: this week, the domestic MAP industry operating rate was about 41.36%, down 4.58% from last week and down 14.05% year on year; the MAP operating rate fell during the week and was below the year-earlier level.

3.2 Domestic DAP Industry Operating Rates

According to FDD data statistics: this week, the domestic DAP industry operating rate was about 43.33%, up 1.48% from last week and down 14.46% year on year; the DAP operating rate edged up during the week and was below the year-earlier level.

4. Domestic Phosphate Fertilizer Weekly Output Trends

4.1 Domestic MAP Weekly Output Trend

According to FDD data statistics: this week, domestic MAP output was about 166,300 tonnes, down 18,400 tonnes from last week, a week-on-week change of -9.96%, and down 23.82% year on year; weekly MAP output declined during the week and was below the year-earlier level.

4.2 Domestic DAP Weekly Output Trend

According to FDD data statistics: this week, domestic DAP output was about 210,600 tonnes, up 7,200 tonnes from last week, a week-on-week change of +3.54%, and down 25.45% year on year; weekly DAP output edged up during the week and was below the year-earlier level.

5. Domestic Phosphate Fertilizer Port Inventory Trends

5.1 Domestic MAP Port Inventory Trend

According to FDD data statistics: this week, major-port inventory of domestic MAP was about 0 tonnes, flat versus last week.

5.2 Domestic DAP Port Inventory Trend

According to FDD data statistics: this week, major-port inventory of domestic DAP was about 29,500 tonnes, flat versus last week.

6. Phosphate Fertilizer Market Outlook

MAP: Looking ahead, the MAP market is expected to continue a weak, range-bound pattern, with no trend-driving upside. On the supply side, industry units have room for flexible restart; if order support is insufficient, some enterprises may flexibly trim operating rates, and overall supply remains relatively ample. On the demand side, domestic autumn-fertilizer demand is essentially wrapped up, compound fertilizer enterprises face shipping pressure on finished goods, raw material procurement continues on rigid-demand buy-as-you-go, and large-scale concentrated restocking awaits the landing of winter storage, with winter-storage policy and grassroots acceptance set to be the core demand-side variables. On the cost side, the upstream phosphate rock, sulfur, and sulfuric acid atmosphere is weak, giving weak support to finished goods. Overall, demand remains the dominant factor, and no obvious boost is expected in the short term. Going forward, focus on single-nutrient fertilizer price trends, downstream compound fertilizer operating rates, and the start-up pace of the winter-storage market.

DAP: Looking ahead, DAP is expected to run mainly weak, with weakening cost support and slow demand release reinforcing each other and prices continuing to soften. On the cost side, phosphate rock at high levels provides rigid support; although sulfur prices have fallen from their highs they remain relatively high, and enterprises' production costs are still at year-on-year high levels, though the degree of support has greatly weakened and cannot drive prices higher. On the demand side, autumn fertilizer is gradually entering its closing stage, grassroots distribution is advancing slowly, bearish sentiment keeps intensifying, low-priced goods are emerging one after another, the bargaining center keeps shifting lower, only a few branded products hold relatively firm quotes, but new-order transactions remain limited, and downstream procurement mostly maintains rigid-demand follow-through. As soil moisture gradually improves, grassroots purchasing is progressively unfolding, yet market supply is overall fairly ample and downstream restocking willingness is not active. Overall, insufficient demand follow-through remains the dominant factor, and no obvious boost is expected in the short term. Going forward, focus on single-nutrient fertilizer price trends, downstream compound fertilizer operating rates, and the start-up pace of the winter-storage market.

7. Sulfur Market Analysis

7.1 Sulfur Market Price Analysis

This week the domestic sulfur market continued its weak downward trend, spot trading was light, and market sentiment was cautious. On the supply side, domestic refineries' by-product sulfur output remained stable and overall domestic supply was steady; on the import side, the center of international sulfur prices moved lower, and falling import costs weakened support for port prices. On the inventory side, domestic port inventory continued to recover to above 1.1 million tonnes; although still low year on year, this is a more significant signal of weakening support for high prices, and downstream enterprises' raw material stocking willingness is not strong, mostly buying as needed, so the port inventory recovery trend has not yet reversed. On the demand side, the downstream phosphate and compound fertilizer industry is in the autumn-fertilizer closing stage, phosphate fertilizer enterprises are operating weakly and prioritize consuming their own raw material inventory, sulfur external procurement demand is contracting; the sulfuric acid industry's follow-through is limited, mainly on rigid demand, with no concentrated restocking. Constrained by demand-side resistance, recent international sulfur spot prices have weakened further. Relevant reports indicate that prices of some resources shipped to Brazil were as low as CFR 950/t, buyers in India and Indonesia indicated intentions at CFR 875-900/t, and there were later rumors of transactions in Indonesia at around CFR 880/t. The weakness of the US-dollar market not only weakened domestic holders' confidence in waiting for the market but also triggered negative feedback of price-cutting sell-offs. If Middle East spot prices come under further pressure later, the domestic spot market will face more direct external pressure. Overall, downstream phosphate fertilizer demand has entered a gap period, and demand from new energy, chemicals, and other sectors is likewise in a weak phase, making it hard to form strong support; the sulfur market is expected to maintain a weak consolidation pattern in the short term. Going forward, focus on international sulfur contract prices, port arrivals, downstream phosphate and compound fertilizer operating rates, and the pace of winter-storage raw material stocking.

According to FDD data estimates: on October 16, the domestic sulfur granular price at Zhenjiang Port was 6,275 yuan/t, down 800 yuan/t from last week; the granular price at Dafeng Port was 6,255 yuan/t, down 800 yuan/t; the lump/powder price at Zhenjiang Port was 6,225 yuan/t, down 800 yuan/t; the lump/powder price at Dafeng Port was 6,205 yuan/t, down 800 yuan/t; the East China solid price was 6,600 yuan/t, down 600 yuan/t; and the East China liquid price was 6,000 yuan/t, down 1,295 yuan/t.

7.2 Sulfur Product Price Comparison

Sulfur Regional Market Quotes Overview (yuan/t)

8. Domestic Sulfur Port Inventory Analysis

According to FDD data statistics: this week, major-port inventory of the domestic sulfur market was about 1,123,500 tonnes, up 32,300 tonnes from last week, a week-on-week change of +2.96%.

9. Domestic Sulfur Output Analysis

9.1 National Sulfur Output Analysis

This week, China's sulfur sample output stood at 217,200 tonnes, with a capacity utilization rate of 51.1%, a week-on-week change of +1.02%.

9.2 East China Sulfur Output Analysis

This week, sulfur sample weekly output in East China stood at 43,800 tonnes, flat versus last week, with a capacity utilization rate of 45.55%, flat versus last week.

9.3 East China Capacity Utilization

According to FDD data statistics: this week, the sulfur operating rate in East China was about 45.55%.

9.4 Solid Sulfur Arrivals

According to FDD data statistics: as of this week, the planned volume of imported solid sulfur arrivals at major national ports for October is temporarily 135,000 tonnes.