1、 Price trend
According to the statistics of the business agency, the price of domestic potassium sulphate fell sharply in 2019. The price of 50% particles in Mannheim, Hebei Province, was 3000 yuan / ton at the beginning of the year, and 2800 yuan / ton at the end of the year, a decrease of 8.2%. It can be seen from the price trend in the figure above that the maximum price of 50% particles in Mannheim appeared at the beginning of August, with a maximum price of 3100 yuan / ton. After that, it has been in a step-by-step decline. By the end of the year, the quotation was 2800 yuan / ton, and the actual transaction price was lower. Because the sales were not ideal, the later quotation was unintentional, and the transaction preferences were a single negotiation.
2、 Market analysis
Judging from the price trend, the potassium sulfate Market in 2019 can be divided into three stages as a whole.
The first stage is from the beginning of the year to the end of May. The domestic potassium sulphate market is not hot and the price of 50% particles in Mannheim fluctuates up and down at 3000 yuan / ton. Although the demand for spring ploughing has been gradually promoted since April, the positive news is limited, and the impact of inventory pressure and upstream potassium chloride has been in a downward trend, which has not supported the price to continue to rise.
Since the export tariff of chemical fertilizer was completely liberalized in 2019, potash fertilizer has cancelled the policy of pricing by volume, which is more affected by the positive effects. The export volume of potassium sulphate has unexpectedly run up, and the growth rate has been far ahead. Although the overall export volume is not large, but for the whole potassium sulfate Market, it has played a role in boosting market confidence.
From the perspective of the industrial chain, the market demand for upstream potassium chloride in the off-season is not strong, the port has a lot of inventory and pressure, and the price falls near the cost line. There is no news about the big contract negotiation at the end of May. At the end of May, the main quotations of 62% white potassium and 60% Dahong granules at the port were around 2350 yuan, 200 yuan / ton lower than the price around 2550 yuan at the beginning of the year.
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The second stage is from June to mid August, which is the golden time of potassium sulphate. The maximum price of 50% particles of Mannheim is 3100 yuan / ton. At the end of May, the maintenance plan and the bidding for agricultural potassium sulphate of tobacco system presented by luok brought a wave of good news to the trend of potassium sulphate. After the end of June, potassium sulphate stands out in the situation of sluggish national fertilizer market, and the trend is optimistic all the way.
From the perspective of market supply, at that time, the operating rate of potassium sulphate industry was running at a low level, while the operating rate of potassium sulphate in water salt system was not high, and the production of luok could not be resumed until the beginning of September. Therefore, first, the output has declined, second, some manufacturers have good water supply, fertilizer dissolution and export sales in the early stage, and the storage pressure of potassium sulphate manufacturers is not large, combined with the cost advantage, all of which form a certain support for the price.
The third stage is from late August to the end of December. From the figure above, we can see that the trend of potassium sulfate is step by step, directly falling below the lowest price last year. In the second half of this year, the overall trend of fertilizer market is relatively poor, especially the leading variety urea, which has declined sharply, seriously affecting the market sentiment. However, potassium sulfate is mainly used as the raw material of compound fertilizer production, which is greatly affected by the start-up status of compound fertilizer enterprises. Due to the low demand, the operating rate of compound fertilizer enterprises fell to about 35%, and the demand for potassium sulfate weakened. The second half of the year is the peak season of tobacco fertilizer bidding, but this year’s tobacco fertilizer bidding did not have a great pulling effect on the potassium sulfate Market, mainly because the bidding volume was basically stable, and the bid price did not exceed the market expectations.
In the face of all kinds of declining trends, several domestic tobacco bidding, the production of potassium sulfate in Taiwan reduced, the domestic potassium sulfate export to Southeast Asia and other places increased significantly, but also failed to maintain the golden time position of potassium sulfate, and the domestic potassium sulfate market gradually integrated into the vortex of historical trend. Therefore, the demand for potassium sulphate in the second half of the year is small and the stock is large, and the overall price will accelerate downward under the guidance of low price.
Import and export statistics
Export quantity and growth trend of potassium sulphate from January to October 2015-2019 (unit: ton)
After the elimination of export tariff, the export of chemical fertilizer in 2019 has experienced different degrees of growth, in which the growth of potassium sulfate export has skyrocketed. According to the data of China Customs, the export volume of China’s potassium sulphate from January to October 2019 was 293369 tons, a year-on-year increase of 3851.4%; the export volume of China’s potassium sulphate from January to October 2019 was 14993000 US dollars, a year-on-year increase of 3679.3%.
Import quantity and growth trend of China’s potassium sulfate from January to October 2015-2019 (unit: 10000 tons)
According to the data of China’s customs, from January to October 2019, the import volume of potassium sulfate in China was 50000 tons, down 9.2% year on year; from January to October 2019, the import volume of potassium sulfate in China was 19423000 US dollars, down 9% year on year.
Forecast for future market
According to analysts of potassium sulphate of the business association, the price of domestic potassium chloride in the upstream is beginning to stabilize in the near future. Whether it improves depends on the next year’s major contract. However, international potassium chloride is still slowly declining, and there is no opportunity for improvement in the short term. Next year, there are plans to reduce the production of potassium sulfate in the water salt system. In the second half of the year, the market of by-product sulfuric acid has been growing steadily. Now, the market is the best period in recent years. Most of the manufacturers have changed from the pre paid money to the money they can sell. However, once the price of sulfuric acid has declined significantly, the cost advantage brought by the decline of potassium chloride will be offset for potassium sulfate. In 2020, potassium sulphate will also face the pressure of inventory and the pressure of profit. It is impossible to get better in the short term. Whether there is an opportunity for improvement in the later period depends on whether the overall environment and demand increase.
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