Vietnam Fertilizer market

3/3/2010 2:04:51 PM [View: 1062]

I. DOMESTIC MARKET

Price movements

Over the week, prices of all fertilizer varieties in localities nationwide stayed stable or slightly increased.

After Lunar New Year, the fertilizer market in the Northern provinces became more exciting as the farmers were producing agriculture positively. At present, the localities in the region transplanted over 40% of 2009/2010 winter-spring rice area. This rice-transplanting phase was estimated to last up to March 5, 2010.

Meanwhile, in the Southern cities and province, as of February 2, 2010, 2009/2010 winter-spring rice transplanted area  reached the schedule, equivalent to 1.65 million ha, mainly of which was in between blossoming and ripening stages (38.8% and 33.9%); seeding and productive stages only remained at 1.8% and 14.9%. With such large above seeding, productive and blossoming areas, fertilizer demand to take care of rice in the region is still quite strong.

It is high fertilizer demand in both the North and the South that caused fertilizer price in many localities to rise; however, the price increase was not quite strong as the fertilizer stock in enterprises met the demand of winter-spring rice crop. Overall, fertilizer market stayed stable or slightly rose around VND 50-400/kg.

In particular, Urea price rose slightly about VND 100-200/kg against the previous week to VND 7,200/kg in HCMC and Da Nang, and VND 7,500/kg in Can Tho. In An Giang, Dong Nai and Tra Vinh, Urea price stayed unchanged at VND 6,800/kg, VND 6,900/kg and VND 7,000/kg compared to the time before Tet.

DAP price in HCMC, Da Nang, An Giang and Dong Nai increased slightly VND 100 – 400/kg to VND 9,600/kg, VND 9,200/kg, VND 8,800/kg and VND 10,200/kg, respectively

Phosphate price slightly rose in Dong Nai from VND 2,050/kg to VND 2,100/kg.

Prices of Potash and SA remained stable for many consecutive weeks. In Dong Nai, Potash and SA were priced at VND 9,550/kg and VND 3,200/kg. Similarly, in Hanoi, prices of these fertilizer varieties reached VND 10,500/kg and VND 5,500/kg, respectively.

II. INTERNATIONAL MARKET

Urea fertilizer:

International Urea market “reduced the heat”.

Baltic region: Urea demand from the North European import market slowed due to the impacts of snow, coldness in this region, plus Euro depreciation against the U.S. dollar. Currently, importers offered the low price of US$ 270/ton while it was over US$ 280/ton offered by producers. 

Black Sea region: The market was quite gloomy. While most producers offered the selling price of nearly US$ 290/ton (FOB), bidding prices were still significantly lower. Most of current trading prices in Turkey were not higher than US$ 280-282/ton (FOB). 

China

After one interrupted week to welcome Tet, China’s fertilizer market started to be exciting. Prices for urea remain high in the domestic market due to increasing fertilizer demand of agricultural production. Fertilizer price in some principal market as follows: Shandong: CNY 1,810/ton, Hebei: CNY 1,790/ton, Henan CNY 1,800/ton, Guizhou: CNY 1,850/ton. Sichuan and Yunnan: CNY 1,850-1,900/ton.

Tonnage in bonded warehouse for export under the 7% tariff was on offer in US$ 320/ton (FOB) or higher.

Phosphate

Phosphate market was reinforced by the information from Pakistan and India.

Specifically, Pakistan’s a largest importer booked earlier in the week 25,000 tons of Russian MAP for February shipment to Engro at US$ 545/ton (CFR). Engro subsequently booked a total of 70,000 tons of US DAP from Transammonia (the U.S) on a price index basis.

India (IPL and IFFCO) signed a contract of 1 million tons of Russian DAP with PhosAgro. However, trading price has not been announced.

However, by the end of the week, phosphate market slowed down because importers were waiting for solutions of remaining problems, relating to fertilizer varieties which were out of India’s control, namely DAP and MOP.

Ammonia

Over the week, ammonia price rose high due to its limited supply from the Black Sea. In the previous week, Petkim (Turkey) offered US$ 415-420/ton (CFR) to buy 12,000 tons of ammonia from Iran, whereas, OCP (Morocco) bought 23,000 ton with the price of US$ 423/ton (CFR) from Sabic. Normally, the Black Sea mainly provides the materials to Turkey and Morocco; however, due to Yuzhnyy’s output shortage (Black Sea region), the buyers have to seek for other supplies. Consequently, they have to pay higher price.

In the Middle East, in the previous week, PCC (Iran) discussed to supply 63,500 tons of ammonia for March shipment to Yara (Italy and Trammo (Egypt) at the price of US$ 367-370/ton (FOB). However, over the week, PCC asked for higher price, staying at US$ 380/ton (FOB).

III. MARKET OUTLOOK

International market

Urea fertilizer

Black Sea region:

Urea price is likely to drop slightly. Most producers told that in short term, they would not receive the selling price like their offered price. However, they denied the rumor that urea price would be equal or lower than US$ 280/ton (FOB).

Baltic region:

Fertilizer market in the region may not be improved unless the exchange rate of Euro against U.S dollar rises significantly.

China

According to China’s National Climate Forecast Center, in the coming time, China is likely to be suffered from severely drought in the South West, the North West and Guangxi, affecting seriously spring rice transplanting. If the drought lengthens, fertilizer volume of spring crop will drop significantly, leading to the decline in fertilizer price.

Phosphate

The Phosphate market is waiting for Indian information about solutions of problems relating to DAP and MOP fertilizers to clearly define the trend.

Ammonia

Ammonia price is forecast to be high until the end of March due to the limited supply and rising demand. Ammonia supply is estimated to be tightened in the Former Soviet Union (FSU) because the adverse weather (ice and snow) affects the agricultural production in this region.

Domestic market

In the short term, domestic fertilizer demand is still high to meet the need of raising agricultural crops, especially paddy. In the Northern provinces, 2009/2010 Winter-Spring rice transplanting phase will last up to March 5, 2010. Meanwhile, in the South, Winter-Spring rice area, which needs taking care of, may be smaller because most of areas are in main harvest. However, high demand of taking care of Winter-spring rice and the preparation of farmers for the Spring-summer crop in some localities lead to the rising demand for fertilizer.

In the long term, the fertilizer price is predicted to be adjusted to rise in accordance with production costs (like petroleum, electricity and coal). The world’s high fertilizer price also directly affects the domestic fertilizer price in the coming crop.

APPENDICES

MARKET DATA

Appendix 1: Vietnam’s principal fertilizer export markets in the first 11 months of 2009

Source: Agromonitor, adapted from Ministry of Agriculture and Rural Development

Appendix 2: Vietnam’s principal SA export markets in 2009

Source: Agromonitor, adapted from Ministry of Agriculture and Rural Development

Appendix 3: Vietnam’s 2009 fertilizer production by month (1,000 ton)

Source: Agromonitor, adapted from Ministry of Trade and Industry

Appendix 4: Vietnam’s fertilizer import volume by month in 2009 (ton)

Source: Agromonitor, adapted from General Department of Vietnam Customs

1． Urea price in some markets, VND/kg

Source: AGROMONITOR

2. DAP fertilizer price in some markets, VND/kg

Source: AGROMONITOR

3. Urea fertilizer price in some markets by week, VND/kg

Source: AGROMONITOR

4. DAP fertilizer price in some markets by week, VND/kg

Source: AGROMONITOR

5. Potash price in some markets by week, VND/kg

Source: AGROMONITOR

6. SA fertilizer price in Dong Nai and Hanoi, VND/kg

Source: AGROMONITOR

7. Phosphate price in some markets, VND/kg

Source: AGROMONITOR        

For further information, please contact:
Email: support@vnex.com.vn
Hotline: 01236679065

Other News

HEAVEN CAVE WAKEN UP!

RETAIL SALES UP 26% IN FIRST EIGHT MONTHS

FORBES CALLS VINAMILK AN ‘UDDER SUCCESS ’

SHOPPING MALLS SET TO BRAND HCM CITY, SUBURBS

BUSINESS IN BRIEF 23/8

TIMBER-PRODUCT EXPORTERS SIGN $3BIL DEALS

BUSINESS IN BRIEF 16/8

PM FUNDS BORDER TRADE PROMOTION

JAPANESE FIRMS TO BUILD NEW PORT

BUSINESS IN BRIEF 15/8