Pre-Spring Festival Weekly News of the Agricultural Materials Industry (Spring Ploughing Window): Intensified Policies, Price Differentiation, Supply Assurance

Summary

In the week before the Spring Festival, the agricultural materials industry saw intensified policies for supply assurance, structural price differentiation and full-capacity production for spring ploughing. China rolled out fertilizer supply-stabilizing policies and extended VAT exemption; potash fertilizer led domestic price gains while international prices stayed firm due to supply contraction. Domestic backbone enterprises operated at full capacity, while international supply tightened due to production and export constraints. Raw material costs and logistics will drive the post-festival market.

Weekly News Roundup of the Agricultural Materials Industry (Pre-Spring Festival): Policy Boosts Supply & Price Stability, Market Differentiation for Spring Ploughing

In the week before the Spring Festival, the agricultural materials industry entered a critical window period for spring ploughing preparation. Domestic policies were intensively introduced to lay a solid foundation for ensuring the supply and stabilizing the prices of agricultural materials. The prices of the chemical fertilizer market showed distinct structural differentiation. Domestic backbone agricultural materials enterprises operated at full capacity to ensure supply, while the international agricultural materials market maintained a firm price trend due to supply contraction, rising logistics costs and other factors. The core dynamics of the agricultural materials industry this week focused on three main lines: policy support, price fluctuations and enterprise supply assurance, laying a foundation for the supply of agricultural production materials for the whole year.

Two Key Policies Issued with Targeted Efforts, All-round Support for Spring Ploughing Material Assurance

In the week, two heavyweight policies were successively released in China's agricultural materials sector, forming a policy synergy for spring ploughing material assurance from the aspects of the whole industrial chain supply and price stabilization of chemical fertilizers and tax reduction for agricultural materials circulation, covering production, circulation, sales and other links.

1. The National Development and Reform Commission (NDRC) issued six measures to ensure fertilizer supply and stabilize prices. On February 5, 2026, the NDRC released the Circular on Doing a Good Job in Ensuring Supply and Stabilizing Prices of Chemical Fertilizers for Spring Ploughing and the Whole Year of 2026 (NDRC Economy and Trade [2026] No. 149), deploying six key measures including guaranteeing the supply of raw materials for chemical fertilizer production, promoting smooth circulation, strengthening reserve management, optimizing import and export services, intensifying market supervision, and advancing scientific fertilization.
2. The VAT exemption policy for agricultural materials circulation was extended for two years. On February 6, 2026, the Ministry of Finance and the State Taxation Administration clarified that according to the Announcement on the Connection of VAT Preferential Policies After the Implementation of the VAT Law (Announcement No. 10 of 2026 by the Ministry of Finance and the State Taxation Administration, released on January 30, 2026), the wholesale and retail of pesticides, seeds, seedlings and agricultural machinery will continue to enjoy the phased VAT exemption policy from January 1, 2026 to December 31, 2027.

Domestic Chemical Fertilizer Market Shows Structural Differentiation, International Agricultural Materials Prices Remain Firm

Affected by raw material costs and weak pre-holiday demand, the domestic chemical fertilizer market showed a structural characteristic of "stable urea prices, rising potash fertilizer prices and follow-up gains in compound fertilizer prices" this week. Driven by supply contraction, rising logistics costs and other factors, the international agricultural materials market maintained a firm price trend as predicted by many institutions.

Domestic Chemical Fertilizers: Costs Underpin Prices, Potash Fertilizer Leads the Gains

The latest market data on February 8, 2026 showed that the price trends of various domestic chemical fertilizer varieties were significantly differentiated. The pre-holiday fertilizer preparation demand came to an end, resulting in a sluggish market transaction, but there was no room for price decline under the support of costs.

• Urea prices fluctuated in a narrow range: the ex-factory price in Shandong was 1,730-1,760 CNY/ton, 1,700-1,760 CNY/ton in Henan, as low as 1,310-1,520 CNY/ton in Xinjiang, and the highest in China at 1,960 CNY/ton (station arrival price) in Yunnan.
• Monoammonium phosphate (MAP) and diammonium phosphate (DAP) prices stabilized: the delivered price of 55% powdered MAP in Anhui was 3,920-3,960 CNY/ton, and the ex-warehouse price of 64% DAP in Shandong was 4,400-4,500 CNY/ton.
• Potash fertilizer prices rose significantly: the pick-up price of 62% white potash at ports was 3,600 CNY/ton, and the station arrival price of domestic 60% crystalline potash was 3,290-3,300 CNY/ton.
• Compound fertilizer prices rose following raw material prices: the delivered price of 45% sulfur-based compound fertilizer was 3,200-3,400 CNY/ton, and 2,650-2,850 CNY/ton for chlorine-based compound fertilizer, with sulfur-based fertilizer becoming the main variety of price increases.
• In addition, January data showed that phosphate fertilizer prices rose significantly year-on-year, with the average monthly price of 55% MAP up 28.79% year-on-year. As a core raw material, sulfur prices soared by 116.50% in 2025, becoming the main driver of the rising production cost of phosphate fertilizer.

International Market: Tight Supply Coupled with Rising Costs, Strong Price Support

Many international analysts stated this week that global chemical fertilizer prices will remain firm in 2026 with no substantial decline in the short term. There is a significant supply gap of global nitrogen and phosphorus nutrients; the supply-demand balance of nitrogen nutrients may take 2 years to recover, and 3-4 years for phosphorus nutrients. The supply of major chemical fertilizer exporting countries such as Russia and Iran is uncertain due to geopolitics and domestic situations, and the chemical fertilizer output of the European Union has only recovered to 75% of the normal level.

The potash fertilizer market has become the core of fluctuations in the international agricultural materials market. Russia and Belarus jointly announced a 10% reduction in potash fertilizer production. The two countries, which control 40% of the global potash fertilizer export share, directly led to a 3%-3.5% contraction in global supply. Coupled with the delay of the capacity release of BHP's Jansen potash mine in Canada to 2028, the global new potash fertilizer production capacity is insufficient. At the same time, the Red Sea crisis has doubled sea freight rates, and Russia's potash fertilizer export quota restrictions continue. Indonesia's potassium fertilizer bidding quotation for the second quarter reached 400-408 USD/ton (CFR), an increase of more than 10% compared with the beginning of the year, highlighting the tight balance pattern of international potash fertilizer supply.

Domestic Backbone Enterprises Operate at Full Capacity to Ensure Supply, International Supply Pattern Tightens

As the Spring Festival approached, domestic backbone agricultural materials enterprises seized the production window period before spring ploughing, operated at full capacity, coordinated production, reserves and transportation, and made every effort to ensure the supply of agricultural materials for spring ploughing. However, affected by policies and project progress, the supply capacity of international agricultural materials enterprises has contracted.

Domestic Enterprises: Salt Lake Potash Fertilizer and Compound Fertilizer Enterprises Make Every Effort to Ensure Supply, Open Up Green Transportation Channels

1. Qinghai Salt Lake Potash Fertilizer Enterprises: The estimated output in the first quarter is 51,000 tons. Three backbone salt lake enterprises in Mangya City (Qinghai Jingxin Potash Fertilizer, China Agricultural Qinghai Potash Salt and Jintai Potash Fertilizer) formed a 492-person production team to ensure 24-hour operation of the production line, refined production tasks to teams and groups, and established a full-chain quality inspection system.
2. Compound Fertilizer Enterprises: Stable production to ensure supply and overall planning of production rhythm before and after the Spring Festival. Gansu Xinyangfeng Agricultural Technology Co., Ltd., a key manufacturer of new crop-specific fertilizers, maintained full-load operation of production lines before the festival, with automated packaging lines operating continuously, and finished compound fertilizers being shipped to various places one after another.

International Enterprises: Delayed Capacity Release and Export Restrictions Intensify Supply Tension

International agricultural materials enterprises showed a trend of contracting supply capacity this week. Due to rising costs and extended construction period, the capacity release of BHP's Jansen potash mine in Canada was delayed to 2028. From 2026 to 2027, only 2 million tons of new capacity from Asian Potash International and 1 million tons from Belarus' Nezhinsky Mine will be put into operation globally, with a supply growth rate of less than 2%. As a major producer of phosphate fertilizer, China strictly controls phosphate fertilizer exports to give priority to ensuring domestic supply, and it is expected to resume phosphate fertilizer exports only in August 2026.

Overall, in the week before the Spring Festival, policies in the agricultural materials industry were fully intensified, providing solid policy support for ensuring supply and stabilizing prices for spring ploughing. Domestic backbone agricultural materials enterprises operating at full capacity to ensure supply have become the "ballast stone" of the market. However, the structural differentiation of prices and the tight supply in the international market have also brought certain challenges to the guarantee of agricultural materials for spring ploughing. As the demand for spring ploughing is released centrally after the festival, the agricultural materials market will gradually enter the peak trading season, and raw material costs and logistics transportation will become the core factors affecting the subsequent market trend.

Data Sources

• National Development and Reform Commission (NDRC), released the Circular on Doing a Good Job in Ensuring Supply and Stabilizing Prices of Chemical Fertilizers for Spring Ploughing and the Whole Year of 2026 (NDRC Economy and Trade [2026] No. 149) on February 5, 2026
• Ministry of Finance and State Taxation Administration, released the Announcement on the Connection of VAT Preferential Policies After the Implementation of the VAT Law (Announcement No. 10 of 2026 by the Ministry of Finance and the State Taxation Administration) on January 30, 2026, and publicly interpreted the extension of the VAT exemption policy for agricultural materials circulation on February 6, 2026
• Agricultural Materials and Cotton & Linen Bureau of All-China Federation of Supply and Marketing Cooperatives and China Agricultural Materials Circulation Association, jointly released the China Fertilizer Price Index Series and monitoring data on February 8, 2026
• Zhuochuang Information, released real-time monitoring data of the chemical fertilizer market and spring ploughing market analysis report on February 8, 2026
• Shanghai Securities News, Agricultural Materials Guide and other authoritative industry media, released news reports on the agricultural materials industry from February 5 to 9, 2026
• Qinghai Salt Lake Potash Fertilizer Enterprises (Qinghai Jingxin Potash Fertilizer, China Agricultural Qinghai Potash Salt and Jintai Potash Fertilizer), released the production and sales plan announcement for the first quarter of 2026 on February 7, 2026
• Gansu Xinyangfeng Agricultural Technology Co., Ltd., released the chemical fertilizer production and sales data in 2025 and the spring ploughing supply guarantee plan in 2026 on February 6, 2026
• International Fertilizer Industry Association (IFA), released the Public Summary of the Medium-Term Fertilizer Outlook 2025-2029 and the global chemical fertilizer market supply and demand analysis report in January 2026
• Rabobank and Independent Commodity Intelligence Service (ICIS), released the global chemical fertilizer price trend forecast report in February 2026

Source: CCM-Cnchemicals

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