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Whether the price of urea rises or not is not so important
Time:2019-11-13   Read:935second  

In the middle of November, the National Conference on phosphorus and compound fertilizer is coming, as if the long silent fertilizer market is about to usher in the "savior", and the market will burn as soon as it touches. So, is it true? At present, it is still too early. The basic reason for the stagnation of the winter storage market is the historical "legacy problem", which was deposited in the previous quarters. The short-term hasty good or even speculation can play a role in boosting, but it is very small.

It may be said that in the near future, there is not only the foil of the phosphate fertilizer conference, but also the momentum of urea price rising again. There are two reasons for the local rise of urea in China: first, the supply in some areas is slightly tight and the demand is increasing; second, India is bidding. Urea price rise, in a certain sense, plays a positive role in the winter storage market. Once the market is solid, the icing on the cake, if not, it is "irrelevant" for water-soluble fertilizer.

First of all, the advantages of cost performance are outstanding. The traditional fertilizer market is blocked, more and more enterprises and dealers are turning to the new fertilizer market, water-soluble fertilizer is undoubtedly the most popular. Compared with the traditional compound fertilizer, the first advantage of water-soluble fertilizer is high fertilizer utilization rate and obvious application effect. According to relevant data, the cost of using water-soluble fertilizer for the same amount of land use fertilizer per mu is even lower than that of traditional compound fertilizer; the second advantage is that the market is relatively stable with little operational risk. With the changes of the traditional fertilizer market in recent years, the market trend basically depends on guessing and there is no rule to follow. In order to avoid risks, dealers gradually accept substitutes. While the price of water-soluble fertilizer is stable, the profits are also more considerable.

Secondly, seasonal demand is weakening. Generally speaking, the demand for compound fertilizer basically extends to all stages of the year, with small difference in light and peak seasons and relatively short interval time. The difference is that in the past, the demand of water-soluble fertilizer was very obvious in the light and peak seasons, and the seasonal binding force was large. After the adjustment of planting structure in most areas, the amount of water-soluble fertilizer increased, so-called light and peak seasons are not so obvious; in addition, the areas that are considered to be planted in a single season every year are also changed now, such as the winter greenhouse vegetable planting in Northeast China is more and more in-depth, and the use of water-soluble fertilizer is more and more extensive. After breaking the seasonal restrictions, the market will be better 。

Finally, policy support has been strengthened. The total amount of water resources in China is insufficient, the spatial and temporal distribution is uneven, and the drought and water shortage seriously restrict the development of agriculture. It is the only way to ensure national food security, develop modern water-saving agriculture, change agricultural development mode and promote sustainable development of agriculture to vigorously develop water-saving agriculture, implement the action of zero growth of fertilizer use, popularize water and fertilizer integration and other farmland water-saving technologies, and comprehensively improve the water production efficiency and fertilizer utilization rate of farmland. Based on the above, China's Ministry of agriculture has formulated the implementation plan for promoting the integration of water and fertilizer (2016-2020), which has been actively implemented in various regions.

To sum up, the recent urea market can be said to be a weak shock. Although there is a so-called "small market" in some parts, the positive is limited, and there is no hope for the price rise again. However, whether the price rise or not is of no decisive significance to the trend of water-soluble fertilizer market. Under the influence of factors such as the demand is good and the cost-effective advantage, the water-soluble fertilizer market will be optimistic again.

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