Increasing production and weak demand would intensify the imbalance of China's phosphate fertilizers in H2 2012.

1. Phosphate fertilizer market forecasts more imbalances in H2 2012
Summary: Increasing production and weak demand would intensify the imbalance of China's
phosphate fertilizers in H2 2012.
Tag: Phosphorus ore, yellow phosphorus, phosphate fertilizer, fine phosphate chemicals
China’s phosphate fertilizer consumption seemed unlikely to catch up with the stable production
growth in H2 2012, according to the forecast from China’s Ministry of Industry and Information
Technology (MIIT), according to CCM’s October issue of Phosphorus Industry China Monthly
Report.
On Sept. 10th, MIIT released a notice regarding China’s fertilizer industry operation of H1 2012
and gave a forecast on the supply and demand market in H2 2012. China’s phosphate fertilizer
industry would see more imbalances between supply and demand in H2 2012, compared to H1
2012.
The notice showed that China’s phosphate fertilizer industry witnessed the increasing output and
decreasing profit in H1 2012. Coupled with nearly 3,000,000t/a new capacity of phosphate
fertilizers entering into the market in 2011 and 2012 in succession, China’s total output of
phosphate fertilizers grew to 9.80 million tonnes in H1 2012, increasing by 18.3% year on year.
Meanwhile, the rising prices of feedstock like phosphorus ore and sulfur greatly squeezed the
margins of enterprises in H1 2012. China’s overall phosphate fertilizer industry generated
USD6.04 billion revenue and USD190.85 million profits in H1 2012, respectively increasing by
18% and decreasing by 33.1% year on year.
Low operation rate drove up unit cost. According to the data from China Phosphate Fertilizer
Association, the operation rate of DAP plants was 65% in H1 2012, versus 75% in H1 2011, while
MAP and NPK fertilizers plants only operated facilities when receiving orders. Among China’s 34
MAP producers, two of them had suspended the production and 11 showed negative growth in
production.
The notice also indicated that the development of China’s phosphate fertilizer industry would
become tougher in H2 2012. China’s exports of phosphate fertilizers would draw to close in Sept.
as low tariff period was about to end. Furthermore, although the demand for phosphate fertilizers
would show seasonable uptrend in the coming autumn, it could still foresee the depression after
autumn, especially when China’s exports of phosphate fertilizers dropped sharply and a massive
supply glut would occur in H2 2012.

2. In general, China’s consumption volume in phosphate fertilizers was estimated to be around 8
million tonnes. The output of phosphate fertilizers in 2012 was expected to reach 17 million
tonnes according to the conservative estimation. However, China’s exports of phosphate
fertilizers won’t exceed 3 million tonnes in the whole year of 2012, indicating that domestic supply
of phosphate fertilizers would approach 14 million tonnes, far more than the demand.
Source: Phosphorus Industry China Monthly Report 1210
http://www.cnchemicals.com/Newsletter/NewsletterDetail_209.html
Headlines of Phosphorus Industry China Monthly Report 1209
Editor's Note
Headlines of Phosphorus Industry China Monthly Report 1210
Phosphorus ore
Company Dynamics: Hubei Xingfa’s new beneficiation line to put into operation
Industry Dynamics: Phosphorus accompanying resources shaped commercialization
Yellow Phosphorus
Industry Dynamics: Yellow phosphorus producers to rid of price fear in Oct.
Phosphate Fertilizer
Industry Dynamics: Phosphate fertilizer market forecasts more imbalances in H2 2012
Policy & Legislation: China to fine tune layout of phosphate industry
Industry Dynamics: Phosphate fertilizer production keeps strong despite tough external
environment
Fine Phosphate Chemical
Company Dynamics: Sichuan Lomon expands phosphorus business in Hubei
Company Dynamics: Yoke Technology expands sales to Europe

3. Global Insight
The Mosaic’s Q1 2013 fiscal result shows DAP price rebound in the US
Supply & Demand
Market review of prime phosphate chemicals in Sept. 2012
Import & Export
International trade situation of phosphate chemicals in Aug. 2012
Price Update
Price monitor of some phosphate chemicals in Sept. 2012
……
Phosphorus Industry China Monthly Report, a monthly publication issued by CCM on 15th of
every month, provides you the latest information on company dynamic, industry dynamic, factors
impacting the price fluctuation, technology improvement, supply & demand of China's phosphorus
industry.
(Guangzhou China, Aug.15, 2012)
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