2013 Chinese Phosphate Fertilizer Market Trend

In the 2013 Chinese Phosphate Fertilizer Market Trend, international demand for ammonium phosphate was closely tied to global agricultural practices and food price dynamics. When food prices were high, farmers had stronger purchasing power, leading to increased use of phosphate fertilizers. Conversely, when crop prices dropped, usage declined. A 2013 survey revealed that while global food prices fluctuated between 2012 and 2013, they generally showed an upward trend. With population growth expected to continue, food prices are likely to rise further, maintaining a strong, steady demand for phosphate fertilizers. Additionally, as economies develop and aquaculture and livestock farming expand beyond traditional grain cultivation, the overall demand for food will grow, driving up the need for phosphate fertilizers after 2013. In 2012, global phosphate fertilizer demand fell by 2.7%, but according to the International Fertilizer Association (IFA), it was expected to recover in 2013 with a 3.5% increase, reaching 41.4 million tons of P₂O₅. Diammonium phosphate (DAP) imports were projected to remain stable at around 14–15 million tons, with trade volume estimated at 6.7 million tons in 2013, slightly higher than the 6.6 million tons recorded in 2012. While Southeast Asian imports declined slightly, this was offset by increased shipments to Africa and Latin America. For Chinese producers, several factors influenced the market. Overcapacity and intense competition were major challenges, along with concentrated export windows from May 16 to October 15. The low price of substitute compound fertilizers also reduced demand for phosphate fertilizers. Additionally, changing consumption patterns in diammonium phosphate affected the market. For distributors, rising production and operational costs led to fierce competition and thin profit margins. Fake or substandard products were also a growing problem. Fluctuating urea prices further complicated the market, directly impacting phosphate fertilizer pricing. As a result, both producers and dealers had to adapt their strategies based on domestic and international demand. China’s phosphate exports stabilized in 2013, following the country’s self-sufficiency since 2007. Diammonium phosphate exports remained around 4 million tons over the past three years, while monoammonium phosphate exports dropped from 870,000 tons in 2011 to about 59 million tons in 2012. This shift was partly due to changes in global fertilizer structures, especially in Southeast Asia, where DAP gradually replaced monoammonium phosphate in BB fertilizer production. Heavy calcium superphosphate exports saw significant fluctuations, peaking in 2011 due to a policy change, then dropping in 2012. This was also linked to declining international demand for heavy superphosphate. India is a key market for Chinese phosphate exports. Over the past three years, the share of exports to India has steadily increased, with DAP exports reaching 665,000 tons in 2012, accounting for 16% of total exports. Therefore, Indian demand plays a crucial role in shaping China’s export volumes. In 2013, export tariffs on DAP and monoammonium phosphate were exempted, and overall export duties decreased by 2–5% compared to 2012. The export window was extended from May 16 to October 15, indicating a more flexible policy. However, the government still does not strongly encourage resource-based exports, suggesting long-term controls may be implemented. In the second quarter, international phosphate fertilizer prices were influenced by raw material costs. In 2012, China accounted for 21.8% of global phosphate fertilizer exports and 38% of imports, showing its significant impact on the global market. Driven by demand in the U.S. and South America, the global phosphate market began to rebound. In April 2013, U.S. DAP prices reached $510/ton, while Middle East DAP FOB was $515/ton, up from $475/ton during the low season. It was expected that international DAP prices had hit a bottom, though future trends remained uncertain. India was negotiating lower prices with Chinese suppliers, but companies sought to extend negotiations. On the supply side, Saudi Arabia was expected to increase DAP production by 700–120 million tons in 2013, while China's supply would rise by about 500,000 tons. Demand in India was expected to grow by 15%, reducing import needs slightly. Argentina showed some recovery, but its small base limited its global impact. Brazil’s demand for DAP was limited, but it influenced the market through demand for other phosphate products. Global excess capacity in ammonium phosphate was a key trend, with stable demand growth in recent years. India, the largest importer of DAP, remained a variable factor. It was predicted that the global DAP market would face oversupply in 2013, with extreme weather potentially worsening the surplus. Prices were unlikely to rise as expected, and a decline could occur. As the window period opened in May, Chinese phosphate exports gradually increased. With India being a key buyer, DAP export prices were expected to range between $510–$525/ton. From September to October, domestic demand for phosphate fertilizers peaks. If the export period remains smooth, the domestic market should stay stable during the autumn season.

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