DAP price expected to rebound from the bottom

Publish time: 27th December, 2012      Source: CCM
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  If historical patterns are any indication, the price of DAP is expected to stop falling and is likely to reverse in late Dec. 2012 or mid-Jan. 2013, according to CCM’s December issue of Phosphorus Industry China Monthly Report.


  On Dec. 5th, the wholesale price index of DAP dropped to 3,333, which has reached a new low since the issue of the first wholesale price index of DAP in June 2012. (Note: the wholesale price index of DAP is abbreviated to CPPI, which stands for China Phosphate Price Index.)


  Indeed, it is noticeable that a sluggishness was spreading throughout the whole DAP market since mid-Oct. 2012—distributors of fertilizer had reduced purchase of DAP, and some bearish agencies warned that DAP prices might keep falling.


  Despite the downturn in DAP market, it’s still remarkable that the current ex-works price of DAP is significantly close to the historical bottom in 2011—around USD488/t. Furthermore, the price fluctuation in current DAP market is also similar with that in the same period of previous year. According to the price monitoring for several representative DAP producers in 2011, the price of DAP began to fall in early Oct. and reached the bottom in early Dec.


  In addition to historical indication, some Chinese mainstream media had widely heralded a positive signal—China's National Development and Reform Commission (NDRC) intended to loosen the export policy on phosphate fertilizer for the next year, which could help China's phosphate fertilizer market to regain phosphate fertilizer producers' and traders' confidence. 


  According to the reports from mainstream media, NDRC held a conference on Nov. 27th to confirm the details regarding the export policy on phosphate fertilizer for 2013. The reported version about "the export policy on phosphate fertilizer for 2013" underlined that the period for low export tariff would be extended from four months (June to Sept.) to five months (May to Sept.) and the export tariff would be revised down.


  Although the spreading version hadn't been confirmed as the final version by NDRC, there is a high probability that NDRC would loosen export policy on phosphate fertilizer. In the meantime, NDRC indicated that the final version for "the export policy on phosphate fertilizer in 2013" might be issued in mid or late Dec. 2012 soon. For DAP market, the final export policy version for 2013 would provide a clear indication for price movement in DAP market.



  Source: Phosphorus Industry China Monthly Report 1212



  Headlines of Phosphorus Industry China Monthly Report 1212:

  New technology to steer phosphate fertilizer production out of sulphur   

  Hubei Xingfa’s prospecting project gets stunning result       

  Yuntianhua publishes specific scheme for reorganization


  Producers meeting Entry Criteria for Yellow Phosphorus decrease to 36 

  Liuguo Chemical conducting “digestible” expansion    

  DAP price expected to rebound from the bottom     

  Kingenta steadily advances expansion in Weng’an County     


  YPC launches P2O5 to expand product portfolio 


  China needs to reduce focus on India’s DAP demand 


  Market review of prime phosphate chemicals in Nov. 2012 

  International trade situation of phosphate chemicals in Oct. 2012 


  Price monitor of some phosphate chemicals in Nov. 2012


  … …


  Phosphorus Industry China Monthly Report, a monthly publication issued by CCM on 15th of every month, provides you the latest information on company dynamic, industry dynamic, factors impacting the price fluctuation, technology improvement, supply & demand of China's phosphorus industry.


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