- Chinese government trying to cut domestic fertiliser prices by export restrictions
- High European gas prices are seen leading to urea production cuts.
- Potash market’s direction depends on imports by Brazill.
There are reports the Chinese government is tightening restrictions on fertilizer exports to reduce domestic prices.
Three urea producers in Shanxi, Hebei and Shandong have been asked by the government to suspend applications for China Inspection and Quarantine Certificates.
Smaller phosphate producers in Hubei have also been requested to suspend applications.
However, other phosphate exporters in Southwest China have not been asked to do so.
Domestic fertiliser prices have been very high during the past 12 months, and the government is now trying to make more fertiliser available thus lowering prices.
Urea Prices Seen Stabilising
The outlook for urea prices is stable because of expected demand from Brazil and a possible Indian tender. Producers are holding back and not offering aggressively. In addition, persistently high gas prices in Europe mean the market expects a major cutback or closure of fertilizer production in the region.
Phosphate Producers Resist Price Cuts
Phosphate producers are under heavy pressure from buyers to cut prices but are holding back. Morocco’s OCP has decided not to publish phosphoric acid prices in India and announced that all its exports to India will be carried out via their Imacid joint venture. In addition, there is uncertainty about exports from. China.
Potash Market Eyes Brazil
The future direction of potash prices is heavily dependent on imports by Brazil. Brazil has been importing large quantities from Russia and sources say inventories are near capacity at the major ports of Paranagua and Santos.
In all, summer in the northern hemisphere, when little fertiliser is applied, and general lack of demand in Southeast Asia and Brazil could prove challenging for fertilizer prices in general over the next 30-45 days.
