Fertilizer export policy was clear in 2011: the trend of potash fertilizer is clear, compound fertilizer is slightly neutral, and nitrogen and phosphorus fertilizers are empty. This year, urea, DAP, and MAP exports have increased rapidly. The state tightens urea by reducing the export of low-tariff exports and the actual increase in export tariffs during the off-season to control the export of phosphate ore, coal, and gas resources and to secure domestic fertilizer supplies. DAP and MAP exports. Nitrogen and phosphate fertilizers have limited space for overcapacity in domestic production, and therefore the policy has been negatively affected. The policy adjustment did not involve potash fertilizer and compound fertilizer. After the policy is clear, there is no need to worry about the limit price of potash; after the prices of urea and MAP are in place, the downstream compound fertilizer companies will end their wait-and-see attitudes and re-purchase, and early next year, potash fertilizer will return to the peak of rising demand and rising prices. The early stage of production and sales of compound fertilizer enterprises has stagnated, and the export policy will be restored after it is clarified.
The potash import and export policy has not been adjusted, and the price rumors have not broken through, which is in line with the view that we recommended the first agricultural oil sector at the end of July: “Only potash fertilizer can fully enjoy the rising domestic and external fertilizer boomâ€. Fertilizer price lags behind agricultural products, and the high consolidation of agricultural products prices is solid. In 2011, both domestic and overseas potash fertilizer demand and price increase became inevitable. At the end of the year, the domestic potash fertilizer will start sales sales again, facing low inventory and strong international demand.
In 2011, the export period of urea reduced its export tariff, and the total export volume was limited. The reduction in the benchmark price and the actual increase in the dynamic off-season low export tax rate significantly reduced the pull of international urea prices on the domestic market. The rise in domestic coal prices will amplify the negative impact. The urea price in ZOH was high before and after low. Despite the recovery of demand, it is difficult to ease the excess capacity, and the industry’s earnings are not optimistic.
In 2011, the period of low export tariffs for DAP and MAP fell from 7 months to 4 months, and the total export volume was limited; the reduction in benchmark prices, the actual increase in dynamic off-season low export tax rates, significantly reduced the domestic phosphate price increase. The increase in export threshold will also reduce the relative advantage of high-grade DAP in phosphate fertilizers. Domestic demand is improving, but to offset the decline in exports, the pressure on phosphate fertilizers containing DAP overcapacity remains the same.
The domestic compound fertilizer companies are in full competition and the differences are not strong. The profit model approaches the dealers. After the export policy became clear, the production and sales of fertilizer companies improved, and the benefits brought about by the recovery of demand for agricultural materials. The overall valuation of listed companies is high and they focus on trading opportunities.