中国磷化工月报(中国磷行业月度报告1803)

China’s phosphorus chemical market remained stable in March 2018, with most products except phosphorus ores seeing sluggish demands. Yellow phosphorus prices rose at first and then made a U-turn, caused by restrained downstream production and reduced demands during the Two Sessions. Few transactions were achieved in the phosphate fertiliser market because of slack sales of downstream compound fertilisers for spring cultivation. Market demand for monoammonium phosphate (MAP) dropped down and that for diammonium phosphate (DAP) also become more sluggish triggered by higher prices. Phosphoric acid and STPP markets remained stable with manufacturers mainly keeping production to fulfil previous orders.

Market dynamics of phosphorus chemicals in March 2018

Phosphorus ore: March saw gradually recovered phosphorus ore market. Compared with prices before the Chinese Spring Festival, actual transaction prices in Sichuan and Hubei provinces increased by USD4.74/t–USD7.89/t (RMB30/t–RMB50/t), a result of falling supplies. Output and sales of manufacturers in Guizhou and Yunnan provinces kept steady.

Yellow phosphorus: China’s yellow phosphorus prices showed an upward trend at first and then phased down. In early March, yellow phosphorus companies only held a small amount of inventories while downstream customers increased purchasing volumes. However, after the commencement of the Two Sessions, downstream companies cut capacities and demands because of strengthened environmental protection inspections.

Phosphoric acid: The market remained stable due to sliding yellow phosphorus prices. Phosphoric acid enterprises mainly kept production to satisfy previous orders. Therefore, phosphoric acid companies may hesitate to produce and its downstream customers, as well, will hold a wait-and-see attitude towards purchasing in the short term.

STPP: No great change was seen in the STPP market in March. Factories maintained low operating rates; downstream industries only purchased limited quantities of STPP to support daily production; and prices of feedstock (phosphoric acid and sodium carbonate) scarcely fluctuated. Given this, STPP prices kept steady.

MAP: MAP prices edged down in March resulted from larger stocks triggered by slack sales and low operating rates of downstream compound fertiliser companies.

DAP: China’s DAP price remained stable in March, but was much higher than 2017. Therefore, farmers were very cautious about purchasing and DAP companies could hardly receive new orders.

The USD/RMB exchange rate in this newsletter is USD1.00=RMB6.3352 on 1 March, 2018, sourced from the People's Bank of China.

All the prices mentioned in this newsletter will include the VAT, unless otherwise specified.

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