Price trend in 2023

 

According to data from Business Society, the average market price of thermal phosphoric acid on January 1st was 9025 yuan/ton, and on December 31st, the average market price of thermal phosphoric acid was 6580 yuan/ton. In 2023, the domestic thermal phosphoric acid market fell by 27.09% for the whole year. The highest value of thermal phosphoric acid for the year was 9050 yuan/ton on January 10th, and the lowest value for the year was 5810 yuan/ton on May 19th.

 

According to data from Business Society, the average market price of wet process phosphoric acid was 8966 yuan/ton on January 1st, and 6450 yuan/ton on December 31st. In 2023, the domestic wet process phosphoric acid market fell by 28.07% for the whole year. The highest value of wet process phosphoric acid for the year was 9116 yuan/ton on January 29th, and the lowest value for the year was 5983 yuan/ton on May 26th.

 

2023 Market Analysis

 

The phosphoric acid market experienced a significant decline in the first half of 2023, followed by a slight increase in the second half and a subsequent decline. In January, the phosphoric acid market fluctuated and stabilized. The price of raw material yellow phosphorus has been adjusted and operated, and there has been no significant change in the cost side for the time being. Before the Spring Festival, downstream phosphoric acid enterprises gradually stopped work and had holidays, resulting in a decrease in terminal procurement. The phosphoric acid market is operating in a stalemate, and the industry is mostly wait-and-see. The post holiday phosphoric acid market is gradually recovering. From February to May, the phosphoric acid market continued to decline. The prices of raw materials such as yellow phosphorus and phosphate ore have been lowered, resulting in insufficient cost support. Downstream demand is weak, overall trading is weak, and the market is mainly bearish. Both cost and demand are weak, and domestic phosphoric acid prices have continuously decreased. From June to October, the prices of phosphoric acid in the market have risen. The price of raw material yellow phosphorus has risen, and cost support is favorable. Downstream rigid demand procurement is the main focus, and the supply of wet acid is relatively tight. From November to December, the market price of phosphoric acid fell again. The market for raw material yellow phosphorus and phosphate ore continues to weaken, and the cost support for phosphoric acid is insufficient. The market demand is sluggish, trading is weak, and enterprise quotations have been lowered, resulting in a strong bearish sentiment in the market.

 

According to the K-bar chart of the year 2023, it can be seen that the maximum increase in phosphoric acid for the year was in July, with a growth rate of 5.4%. The largest decline of the year in April was 13.41%.

 

2024 Aftermarket Forecast

 

Gamma Polyglutamic Acid

Cost situation

 

In terms of raw material yellow phosphorus. In 2023, a year of supply-demand contradiction in the yellow phosphorus market, the overall market price fell, with a price drop of 30.68% within the year. Overall, the future will maintain stable development. Domestic yellow phosphorus production enterprises need to increase investment in environmental protection, improve production processes, reduce energy consumption and pollution emissions, and promote the industry’s development towards green and sustainable direction.

 

In terms of raw material phosphate ore. In 2023, the phosphate ore market has seen a wide range of ups and downs, but has stabilized and ended. In 2024, the overall supply side of phosphate ore will remain tight, providing market support and increasing downstream demand. The overall phosphate ore market is still on the rise, but the current market price is already at a high level. Therefore, the expected price increase in the phosphate ore market in 2024 is limited.

 

Supply situation

Since 2017, the production capacity of thermal phosphoric acid has gradually decreased, while the production capacity of wet process purified acid has gradually increased, and the overall production capacity has continued to increase. In 2022, the demand for new energy battery materials in China will increase, and the scale of the phosphoric acid market will increase. The market size of wet process phosphoric acid is 19.879 billion yuan, and the market size of thermal process phosphoric acid is 6.372 billion yuan. It is expected that the industrial phosphoric acid production capacity will reach 2.3188 million tons by 2023.

 

Export situation

 

The export volume of food grade phosphoric acid from China in 2023 was 363900 tons, a decrease of 19.63% compared to the same period last year. The export amount was 396 million US dollars, a year-on-year decrease of 45.02% compared to 2022. Due to significant fluctuations in raw materials this year, foreign buyers have been more cautious, resulting in a decrease in export volume. There is little improvement in the short term, and it is expected that the export market in 2024 will not be optimistic.

 

Demand situation

 

The downstream demand in the phosphoric acid market in 2023 is mainly in industries such as phosphate, food additives, and surface treatment (phosphating and oxidation). Most of it is used for the production of phosphates. Phosphoric acid is one of the main raw materials for lithium iron phosphate. Due to the rapid development of the new energy industry in recent years, the demand for phosphoric acid has significantly increased.

 

summary

 

In summary, in 2023, the domestic phosphoric acid market was affected by weakened costs, high market supply, and reduced export orders, resulting in an overall weak and downward trend in the market. It is expected that the cost side and demand will be supported in 2024, but there will still be oversupply and poor export conditions. The domestic phosphoric acid market will mainly fluctuate, consolidate and operate. In recent years, under the pressure of environmental protection policies for phosphorus chemical industry, China’s phosphoric acid production technology will continue to improve and optimize.

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