Potash fertilizer joint price may rise after successful negotiations
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From the perspective of the overall situation of the national potash fertilizer market, in the context of the success of the potash fertilizer joint negotiations, the domestic potash fertilizer market has not experienced severe shocks and price fluctuations have been confined to individual regions. However, with the further tightening of potash fertilizer market at home and abroad, the price of domestic potash fertilizers in the second half of the year is inevitable.
On January 26th, it was 13 days since the end of the negotiations on potash fertilizers.
The price of potash fertilizer in Guangxi has not risen and fell, and it has unexpectedly dropped around RMB 30 per ton. In Heilongjiang and Anhui, the market price of potash fertilizer is stable. From the perspective of the overall situation of the national potash fertilizer market, in the context of the success of the potash fertilizer joint negotiations, the domestic potash fertilizer market has not experienced severe shocks and price fluctuations have been confined to individual regions. According to market participants, “the current favorable factors for the contracting of marine potash fertilizers have been basically digested by the market. With the further tightening of potash fertilizer market at home and abroad, the international potash fertilizer price is showing a small step and rising steadily. In 2011, China It is difficult to avoid the rising trend of imported potash fertilizer prices."
Domestic and foreign market tightness enhancement In accordance with common practice, Sinochem, China Agriculture and BPC determine the supply price, Canada Canpotex Potash Joint Sales Company, Russia IPC, German K+S, Jordan APC, Israel ICL, Chile SQM and other companies will also refer to BPC The pricing methods have been successively confirmed with the Chinese import companies for the shipping of potash fertilizer contracts. Sure enough, on January 20, potash seller Canpotex and Sinochem Chemicals signed an agreement to supply 600,000 tons of potash fertilizer to Sinochem in the first half of 2011. BPC and Canpotex signed a contract for marine potash fertilizer with China, and their pricing methods have been changed from the previous year to the first half of the year.
Faced with such a big change, the industry has had different reactions. Active people believe that the shorter pricing cycle is conducive to the international potash fertilizer suppliers adjusting supply quantity and price in accordance with market changes, and at the same time “will be closer and more flexible to international market pricesâ€.
Those who are worried believe that because of the many uncertainties in the renegotiation negotiations in the second half of the year, the potash joint negotiations will surely become an important subject for market speculation. “The current trend of international potash fertilizer prices is obvious, which is very unfavorable for China’s potash fertilizer imports. ."
The current situation that China's soil is already deficient in potassium is difficult to change. “However, the change in the contract pricing mechanism for marine potash fertilizers has further strengthened the tightness of domestic and foreign markets. This is undoubtedly the case. For the media, frequent citations of potash fertilizer may fall into iron ore. The same dilemma of stone, in my opinion, is a bit meandering." The market sources said.
First, potash is a resilient demand variety. Once the price of potash is too high, the leverage in the domestic market will automatically play a regulatory role, and the sharp drop in market demand will inevitably lead to the impact on potash fertilizer imports.
Second, the production capacity "does". At present, the domestic demand for potash fertilizer is 8 million tons to 10 million tons, domestic supply is 5 million tons, and the annual import of basic potash fertilizer is maintained at about 5 million tons. “We have calculated that although the current export suppliers of potash are relatively concentrated, the increasing production capacity will also push potash export suppliers to high levels. If different countries sign contracts for marine potash, the markets of countries such as India and Brazil will also be unable to digest 5 million tons. The output."
Furthermore, from a domestic point of view, there is no panic in the hands of the people. At present, domestic traders and manufacturers have a certain potash stock in their hands. If the price of potash fertilizer in the international market is higher than the affordability of farmers, it will inevitably reduce imports. At the same time, because there is a certain amount of stock in hand, domestic companies will not feel that supply of potash is in short supply. However, under the background of a 16.9% increase in the contract price of marine potash fertilizer, the international price of potash fertilizer is unlikely to rise.
Post-holiday domestic fertilizer prices may rise In the context of further tightening of the potash fertilizer market at home and abroad and the rising trend of international potash fertilizer prices, the domestic imported potash fertilizer prices will not be able to escape the upward trend in the second half of the year. From the overall situation, the price of imported potash fertilizer in China will show an upward trend in 2011.
However, many uncertainties that currently exist are difficult to eliminate at the restart of negotiations in the second half of the year. The key factor is the large increase in global demand for food. In early December 2010, the International Fertilizer Industry Association (IFA) raised the global potash fertilizer demand forecast for 2010/11. The growth rate of demand in 2010 and 2011 was 18.9% and 7.9% respectively. In the same period, the actual effective supply of potash in the world will only increase by 1.9% and 2.1% respectively. The above factors have laid the foundation for the increase in potash prices.
On January 24, SQM potassium fertilizers from European and American markets were reluctant to sell. Driven by the increase in prices of agricultural products, the global demand for potash fertilizers has grown significantly. The reluctant sellers of potash fertilizer in Europe and the United States will inevitably lead to tight supply of international potash fertilizers, which will increase international potash fertilizer prices. This has also become the basis for the future price of potash fertilizer in China to rise further.
It is expected that the total amount of potash fertilizer imports in China in 2011 may not change much compared with 2010, but the average price may rise by a certain extent compared with 2010.