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With the changes in market supply and demand and the support of related stable price policies, from the beginning of December, the normal monthly production of urea began to recover, coupled with the previous light reserves, there will be no major problems with urea supply in the coming spring. Yang Chunsheng, chairman of the Shandong Chemical Fertilizer Industry Association, believes that the current decline in fertilizer production is influenced by multiple factors and is an inevitable trend. As the market improves, the production capacity of some large companies will be normal and production will increase. Yang Chunsheng is more concerned about the weather next spring. He believes that if bad weather occurs again, it will have a fatal impact on the start-up and demand of the fertilizer market.
Liu Jincheng, head of Hebei Yangmei Zhengyuan Chemical Group, is very confident about the fertilizer market next spring. He said that despite some difficulties in the urea market this year, the production and operation of the company are basically the same as last year. Due to the advantages of coal resources, the construction of their 1 million-ton project in Bohai New District of Bozhou is still under normal plan.
Gui Qi, Vice President of China Phosphate Fertilizer Industry Association, took an example of supply and demand of diammonium phosphate and analyzed the phosphate fertilizer market next spring. She believes that from December to May next year, diammonium production can reach 7 million tons, plus company inventory at the end of October and November production of 1 million tons, exports of 600,000 tons, total resources of 8.6 million tons (this does not include supply and marketing The headquarters has an existing stock of 1.5 million tons). Qi Hao reminded enterprises that the current volume of goods in the market is not sufficient, and enterprises need to do a good job of winter storage. We must actively use the transportation gap before the Spring Festival, and store the company's inventory and the phosphate produced in December as far as possible, especially in the northeast and northwest. Regionally, minimize corporate inventory.
Although there are many optimistic voices, there are also views that: Since this year, a considerable number of chemical fertilizer production enterprises have been unable to withstand the dual pressures of rising production costs and sluggish markets, they have been forced to stop production and reduce production; after July, all localities have completed tasks to save energy and reduce emissions. Limiting production of fertilizer companies, resulting in urea production dropped for the sixth consecutive month. The sharp increase in the reduction in urea production and the number of exports raises concerns about the shortage of fertilizers, especially urea, next year. This concern was clearly reflected in the forum for the sales of the top five nitrogen fertilizer groups held in Beijing not long ago.
At the end of the year, people in the fertilizer industry are paying more attention to the trend of the fertilizer market next year. Some manufacturers and distributors are worried that the market supply will be tight in the spring of next year, but some people in the industry are relatively optimistic about the overall outlook for the market next spring. The supply is guaranteed and the prices remain stable.
January 11, 2019