September 11 Pesticide Daily Review: Cautious Observation

Overall sentiment in the pesticide market remained weak. Downstream demand follow-through was limited during the traditional off-season, leaving the market without sufficient momentum. However, some products received strong support from rising costs, while various factors caused supply to contract, leading to sharp short-term price increases. At the same time, price-transmission problems along the industrial chain have raised expectations of negative feedback from downstream buyers following the increases. The market is therefore waiting to assess the extent to which end-user demand can absorb higher prices.

Geopolitical tensions in the Middle East remain elevated. Direct armed conflict between the United States and Iran continues, while Houthi forces have also conducted military operations against Saudi Arabia. Expectations for navigation through the Strait of Hormuz and the Bab el-Mandeb Strait, two major maritime chokepoints, have weakened, reviving expectations of higher petrochemical industry costs.

Overall, cautious market sentiment persists. Some products have recorded notable increases, but other categories have shown limited follow-through, resulting in clearly divergent market trends and a continuing wait-and-see atmosphere. Attention should be paid to changes in geopolitical sentiment, export strength and seasonal demand.

Market Analysis

Herbicides: The herbicide market remains in low-level consolidation. Current prices are close to the cost line, leaving limited room for further declines, although weak demand is also restricting the upside. Cost increases arising from geopolitical risks remain, but insufficient demand absorption has failed to provide momentum. Glufosinate prices have recently surged, mainly because of tight production and price increases for raw material intermediates, India’s anti-dumping measures and other factors. The market is closely monitoring transactions following the sharp price increase. If the upward trend continues, substitute products may also follow with price increases. Overall, most downstream buyers continue to take delivery only for rigid demand. The market is watching whether strength in individual products can broaden into a wider market trend.

Yellow Phosphorus: Yellow phosphorus prices continued to undergo a modest correction today, while transaction sentiment remained subdued. In the short term, producers are mainly shipping existing orders. Mainstream producers recorded relatively satisfactory sales earlier, while most midstream and downstream buyers have completed stockpiling, resulting in limited follow-through on new orders. Upstream producers are actively making shipments to free up storage capacity, while downstream buyers are taking the opportunity to negotiate prices lower. Transaction sentiment remains cautious. Downstream follow-through is slowing in the short term, placing renewed pressure on market sentiment. Participants are mainly adopting a wait-and-see stance, although downside potential may remain limited. Attention should be paid to whether downstream restocking interest improves after prices decline.

Pesticide Market Price Overview

Herbicides:

96% quizalofop-P-ethyl fell by 5,000 yuan to 135,000 yuan/tonne. 95% nicosulfuron fell by 3,000 yuan to 150,000 yuan/tonne. 97% fluroxypyr fell by 2,000 yuan to 70,000 yuan/tonne.

Insecticides:

97% pymetrozine fell by 2,000 yuan to 94,000 yuan/tonne. 97% chlorpyrifos fell by 1,000 yuan to 37,000 yuan/tonne. 98% monosultap fell by 2,000 yuan to 80,000 yuan/tonne.

Fungicides:

96% hexaconazole fell by 2,000 yuan to 86,000 yuan/tonne. 95% epoxiconazole fell by 5,000 yuan to 230,000 yuan/tonne.