Compound Fertilizer: Advance in Manufacturer's Game

Currently, for the compound fertilizer market, the factors that affect the market are diversified and complicated, which makes it more difficult to predict the direction of the future market. In particular, it is more difficult to achieve long-term prejudgment. In the face of market uncertainties in the spring of next year, compound fertilizer manufacturers will not blindly formulate sales policies. Most of them adopt conservative strategies. Therefore, the compound fertilizer market will move forward in the game of manufacturers.

Today, the general market outlook for urea and diammonium is generally bearish, and the potash market continues to be sluggish. These factors may cause compound fertilizer prices to decline further. In this general bearish situation, there has been no substantial progress in the Dongchuan. But no matter what the trend of the raw material market will not bring any change to the current market, after all, the next spring is still a more distant future. Due to the lack of confidence in the prediction of the market next spring, the stalemate of the market is inevitable.

First, the decline in the price of raw materials is limited. With the favorable support of exports, the price of urea is still relatively strong and may rise slightly in the short term. With the end of the export window period, the price of urea will fall slightly. Wheat said: “Coal is an important factor affecting the price of urea. From the current market situation, the price of coal has been relatively stable, and the decline may not be large, so the cost of urea basically stabilizes.” Another factor that affects the price of urea The relationship between supply and demand is due to the decrease in market demand after entering the winter storage stage, which will bring pressure on the manufacturers. Therefore, “the trend of falling urea has already formed, but based on the cost stability, the rate of urea decline should not be very low. "At present, urea production capacity has further expanded and the market needs further shuffling. The performance of such a reshuffle is to cut prices. Those enterprises that do not have an advantage in resources, management, and technology will not be able to withstand the impact of price cuts. These companies will gradually be eliminated during the reshuffle. "Because our country's major policies do not advocate the outflow of resources, but domestic demand is limited, so elimination is inevitable."

In terms of diammonium, due to the high industrial concentration of diammonium, the current diammonium enterprises all have a certain scale and have a certain ability to resist risks. Therefore, the diammonium enterprise structure will not undergo major changes in the short term. Due to high industrial concentration, their ability to respond to market changes is strong. Once the market is not optimistic in the later period, companies can use the method of reducing the operating rate to resist the market price cuts. Overall, if the cost permits, the price of diammonium will drop, but the rate will not be large.

In terms of potash fertilizers, due to the fact that compound fertilizer manufacturers are in no hurry to store large quantities of raw materials and potash fertilizer demand is low, it is expected that the potash fertilizer market will not be improved in the short term.

Second, the manufacturer's game opened the curtain In the face of this year's winter storage, compound fertilizer manufacturers can not accurately determine the market for the coming spring market. At present, the factors that affect the market are diversified and complicated, which makes it more difficult to predict the future market direction. In particular, it is more difficult to achieve long-term prejudgment. In the face of market uncertainties in the spring of next year, compound fertilizer manufacturers will not blindly formulate sales policies. Most of them adopt conservative strategies. For now, most of the compound fertilizer manufacturers adopt a strategy of keeping interest at the end. In addition, the problem that the compound fertilizer industry has to consider is that there are many small enterprises. Relative to urea and diammonium, their production costs are relatively low, so their production is more flexible. In the short term, compound fertilizer companies will mainly rely on overhaul and will not purchase raw materials in large quantities. Although sales stagnated, but all manufacturers are actively operating the winter storage issues, try to collect the customer's winter storage funds, in advance to prepare for the market. On the whole, the new round of manufacturer's game has already begun, manufacturers will actively lobby dealers to play money, and give certain benefits, dealers will be the majority of wait-and-see attitude, compound fertilizer market conditions will also slowly advance in the stalemate.