9.9-9.13 Weekly summary of phosphoric acid and raw materials
Weekly market summary of phosphoric acid and raw materials(9.9-9.13)
Phosphate Rock:
There was no change in phosphate rock prices this week. In terms of production, phosphate rock enterprises in the northern region have resumed production, and the short-term improvement of supply capacity is limited, and the transaction price of phosphate rock is relatively stable.
Yellow phosphorus:
The price of yellow phosphorus gradually declined this week. Some downstream enterprises reduced their production capacity and procurement for yellow phosphorus was significantly reduced. In order to promote the shipment, some manufacturers and traders signed orders with a slight price reduction. However, considering that the current phosphate rock price is difficult to fall at a high level and there is still an expectation of rising, coupled with the approaching October, the electricity price in Yunnan and Sichuan may be raised, the cost of yellow phosphorus is easy to rise and difficult to fall, so the price of yellow phosphorus has little room to fall.
Supply: The supply of yellow phosphorus this week increased slightly compared to last week. A few manufacturers in Sichuan Ya'an area, Panzhihua area increased and normal production.
Inventory: The inventory of the yellow phosphorus this week was about 23,400 tons, a slight increase from last week. The main reason is that the procurement of downstream enterprises of yellow phosphorus has decreased significantly this week. But some yellow phosphorus manufacturer have sufficient pending orders, so the inventory increase is not large.
On the demand: this week, the demand for yellow phosphorus is light, and the new orders are few, mainly because the price of yellow phosphorus has risen to a high level in the early stage, the price of downstream products has risen slowly, the cost pressure has been increasing, and it is difficult for downstream enterprises to accept the high price, and the procurement has decreased significantly.
Forecast: Some companies are expected to have replenishment needs after the Mid-Autumn Festival holiday next week and coupled with the approaching Chinese National holiday, it is expected that the price of yellow phosphorus will be stable and strong.
Positive：
- At present, some yellow phosphorus enterprises have pending orders, and there is no shipping pressure for the time being; Some enterprises have procurement plans in the wet season and low inventories, and it is expected that the price reduction may not be high.
- Approaching of the Chinese National Day, according to the law of previous years, downstream enterprises will stock up in advance. During the National Day, high-speed transportation is prohibited, downstream enterprises will generally replenish inventory in advance, prepare for the production of the seven-day National Day holiday, and next week is in the stocking period before the National Day, and the demand is expected to increase, to a certain extent, to support the strong operation of prices.
- The cost side is good support. Approaching October, there is news of rising electricity prices in Sichuan and Yunnan, which supports yellow phosphorus enterprises to maintain a low price mentality.
Passive:
- The operating rate of yellow phosphorus market is well, and the supply is high.
- The demand for downstream products has not improved significantly, coupled with the difficulty of keeping up with the price rise, it is expected that the acceptance of the high price of yellow phosphorus is low.
- Individual enterprises are expected to have plans to stop production and reduce production, and reduce the consumption of yellow phosphorus.
Thermal phosphoric acid:
This week, the price of thermal phosphoric acid rose first and then stable, and the downstream mostly held a wait-and-see attitude. The main reason is that the downstream enterprises has much inventory of yellow phosphorus with high price in the early stage. The transaction is limited and it is difficult to trade at a high price.
For the cost, transactions of yellow phosphorus were weak, and the price continued to decline slightly. In the early part of the week, the cost of thermal phosphoric acid was strongly supported, and the price was slightly raised; In the later part of the week, the price of yellow phosphorus decreased slightly, but the cost was transmitted in the industrial chain with a time lag, the quotation of most thermal phosphoric acid enterprises remained stable, and the mainstream transaction price of the market was temporarily stable.
For the supply and demand, individual manufacturers in the southwest and northeast resumed production this week, and the overall supply of the market increased, but the downstream pre-holiday stocking was basically over, and there were few large orders in the field, and the market demand was average.
Forecast: It is expected that the market price of thermal phosphoric acid will be stable next week, and the supply and demand sides will still wait and see, and the market price will be in a dilemma.
Wet purified phosphoric acid:
This week, the price of wet purified phosphoric acid is stable.
For the supply, some manufacturers of Guizhou, Sichuan, Guangxi resumed operation at the beginning of this week, the market supply increased in a narrow range, but most of the manufacturers have low inventory and pending orders, short-term bargaining power still exists, enterprises to maintain a positive price stabilization or bullish mentality.
For the demand, downstream procurement is carried out on demand. Domestic demand is stable, but it remains cautious and resistant to the high price of purified acid. The demand of exporting is normal.
From aspect of the thermal phosphoric acid, this week, the downstream of yellow phosphorus just needs to be light, and the supply of yellow phosphorus factories is sufficient, and it is difficult to trade at high prices, and the center of gravity of the transaction is falling step by step. The market price of thermal phosphoric acid is temporarily stable, but due to the impact of cost in the later stage, the price is expected to decline, which aggravates the wait-and-see mentality of the wet purification phosphoric acid plant and boosts the price of purified acid in the future market.
Forecast:
It is expected that the low-price transaction of wet purified phosphoric acid will be limited next week, and the price will be stable or slightly rising.
1. It is recommended to pay attention to the changes in output on the supply side. It is expected that there are plans to increase production in Guangxi, Sichuan, Yunnan and other places next week, and the supply side will continue to increase at that time. In the short term, factory inventories remain low, and although market supply increases, factories still have some room for bargaining; In the long run, the market demand is limited, the market supply is gradually increasing, considering the end of the factory pre-received orders in the later stage, the factory inventory increases, and the price negotiation of the purification acid factory.
2. Pay attention to the operation of downstream iron phosphate plants and the change of mentality of downstream goods. It is not excluded that due to the impact of the Mid-Autumn Festival, the downstream will inquire and purchase in advance, and the market will increase in trading, which is good for the price of purified acid. In addition, the domestic new energy market demand is expected to increase, but it is not excluded that some factories may continue to maintain a cautious price reduction mentality, and it is difficult to negotiate at high prices, and the transaction is close to the low-end. On the export side, there are sufficient orders, which supports domestic prices.
3. Pay attention to the price transmission of yellow phosphorus-thermal phosphoric acid next week. It is difficult for the price of yellow phosphorus to stabilize, superimposed on the limited shipment of the Mid-Autumn Festival, and there is no clear bullish expectation for the price outlook, and the falling price has been transmitted to the thermal phosphoric acid market, intensifying the price game with wet purified phosphoric acid, and there is negative support.
