2024.11.4-2024.11.8 Weekly summary of phosphoric acid and raw materials
Phosphate Rock:
The price of phosphorus ore is no change this week. Because of the security inspection in Hubei, and environmental inspection in Sichuan and Guizhou, some mining companies suspended production, so market supply has been affected in some certain areas in short term.
For 28% grade raw ore: Reference price in Guizhou is 940-960 yuan per ton; reference price in Yunnan is 890-910 yuan per ton; reference price in Hubei is 1000-1020 yuan per ton.
For 30% grade raw ore: Reference price in Guizhou is 1030-1050 yuan per ton; reference price in Hubei is 1030-1050 yuan per ton; reference price in Yunnan is 940-960 yuan per ton.
Yellow phosphorus:
The price of yellow phosphorus has slightly declined this week, although the cost has increased slightly and there’s support for the demand, but downstream companies are mostly postponing the procurement due to the high price now, some trading companies lower their price for promoting sales.
On the cost side: The cost of yellow phosphorus increased slightly due to the electricity power price in Yunnan and Sichuan have risen with coming of dry season.
Supply and operating rate: The supply of yellow phosphorus is sufficient even though some producers in Guizhou and Sichuan areas reduce or suspend production affected by the environmental inspections, coupled with the market inventory, some companies lower their price for promoting sales.
On the demands side: Some downstream companies have suspended production due to maintenance, which is difficult to drive raw material consumption. The overall raw material inventory is high. In addition, with the decline in yellow phosphorus prices, most downstream companies are waiting to see the later prices and delay purchasing plans. Some trading companies have previously low-price to promote sales, which is difficult to support the yellow phosphorus price to stop falling and stabilize.
It is expected that the demand for downstream products will not improve in the short term, and the terminal market will provide insufficient support for the sales of the industrial chain. On the other hand, it is difficult to eliminate the cautious wait-and-see mentality of buyers of production enterprises in the short term, as they buy when prices rise and do not buy when prices fall. The current output volume, plus the industry inventory and the expected low volume of new orders will lead to an increasing supply in the short term. It is recommended to pay attention to the start-up plans and inventory plans of yellow phosphorus enterprises, and the start-up and procurement plans of downstream enterprises.
Thermal phosphoric acid:
The FOB Fangcheng price for 35KG thermal phosphoric acid is USD1035.00 to USD1130.00 this week, increased by USD60 per ton.
Thermal phosphoric acid prices remained stable this week and new orders were rare. The price of yellow phosphorus had declined slightly, which resulting in the price decline of thermal phosphoric acid.
On the cost side: Although the price of yellow phosphorus has dropped this week, most thermal phosphoric acid companies still use inventory raw materials, and the cost impact is not obvious for the time being.
On the demand side: Downstream procurement are mainly based on demand. The price of raw materials continues to fall, but customers remain on the sidelines.
On the supply side: Some companies in Sichuan suspended production or reduced production due to the environmental inspections, The price of thermal phosphoric acid remained stable this week, and new orders were rare. The price of raw material yellow phosphorus continued to fall, and the quotations of some companies also followed a slight decline.
Cost: Although the price of yellow phosphorus has dropped this week, most thermal phosphoric acid companies still use inventory raw materials, and the cost impact is not obvious for the time being;
Demand: Downstream purchases are mainly based on demand. On the other hand, the price of raw materials continues to fall, and other customers remain on the sidelines.
Supply: This week, some companies in Sichuan stopped production or reduced production due to environmental protection inspections.
It is expected that the market price of yellow phosphorus will be difficult to stop falling in the short term, and there is still a downward expectation. The cost support of thermal phosphoric acid has weakened; the domestic demand and export markets are slow, and the price lacks substantial support; in the short term, the market price of wet-process purified phosphoric acid is still strong, and some large factories still have maintenance plans, and the supply may be tight, which is beneficial to the stabilization of the market price of thermal phosphoric acid.
Wet purified phosphoric acid:
There was no change for the price of wet-process purified phosphoric this week. The procurement of downstream was rare.
On the supply side: The main producer in Fujian had resumed production this week, the spot inventory has increase slightly but need to pay attention to the operating rate and maintenance plans of another producers in November.
It is expected that the price of wet-process purified phosphoric acid will continue to remain stable next week. In November, some producers are expected to still have maintenance plans, and there’re sufficient pending orders for producers, so the spot market is expected to be tight; in addition, the operating rate of downstream iron phosphate is stable, and there is no obvious reduction in the consumption of wet process phosphate acid, so the rigid demand is stable.
Sodium carbonate:
The price fluctuation of sodium carbonate is limitedly and the price in some regional markets lowered, but the overall market price did not change significantly.
On the supply side: The operating rate of the sodium carbonate continued to decline this week, but the overall market supply was still sufficient.
On the demand side: Downstream demand continued to shrink.
On the cost side: The cost of the sodium carbonate industry rose this week, but downstream demand was sluggish, and the overall profit of the industry continued to shrink.
In the future, the price of sodium carbonate will continue to maintain the current price level, and the market supply and demand fundamentals are difficult to improve.
