Although receiving more attention, urea is still fluctuating at high levels, and ammonium phosphate is still strong at high levels. One is wobbling and the other is steady and not giving, which is a good guarantee and stability. The price of potassium chloride has also remained at a relatively high level, but recent trading has been relatively quiet, making it a bit difficult to hold up the price. Why is potassium weaker when potassium is lower when nitrogen and phosphorus prices are higher? Its root lies in the international community.

About 50% of potassium chloride in our country relies on imports, compared to 70% in previous years. We also implement a large contract negotiation import mechanism, so the formation of market prices has always been mainly guided by the price of imported potassium. The rise and fall of international prices and the quantity of imports often determine the tone of domestic potassium fertilizer market prices. The price of potassium chloride plummeted in the first half of the year, while domestic prices rebounded in the second half. However, the international market continued to decline, with only a slight weakening of the decline.

On the one hand, the supply side is gradually recovering and new production capacity is being invested, and on the other hand, the demand side continues to be weak, causing concerns of excess in the international market once again. Currently, the CIF price range in major regions is only $300 to $400 per ton, and it is moving towards the low end. The current contract price is 307 US dollars per ton, and the market price is equivalent to a landed price of approximately 330-360 US dollars per ton. We have always been proud of the "world depression", so from a cost perspective, how to look at the trend is clear at a glance.
Customs data shows that China's potassium chloride import volume from January to October reached as high as 9.15 million tons, while only three times in history have the annual import volume exceeded 9 million tons, namely 9.41 million tons in 2007, 9.43 million tons in 2015, and 9.08 million tons in 2019. Looking at this momentum, the import volume of potassium chloride is expected to reach the level of millions of tons this year, achieving a historic milestone for the first time. It is worth noting that the supply of China Europe freight trains directly to the hinterland has significantly increased, especially the significant increase in the quantity from Laos, with a total of 1.34 million tons from January to October alone. These two dark horses, the former challenges the traditional domestic pattern, while the latter also challenges the international market pattern.

There are a lot of imports, and looking at the cost, these will be two big mountains in the future potassium chloride market and will restrict the recent price increase. Therefore, although potassium chloride has a low price, it is still a bit difficult to sustain. However, the pressure will mainly manifest in the future (during the negotiation period of the new major contract), and in the short term, it will only constrain the upward trend rather than necessarily suppress it, or it can be said that this downward pressure can still be resisted in the short term. Due to the relatively low nitrogen and phosphorus ratio, the downstream being empty and the upstream having strong field control capabilities, as well as the complex and ever-changing international situation, these factors should still be able to maintain the price of potassium chloride at a certain high level in the short term.

At present, the consensus in the industry regarding nitrogen, phosphorus, potassium, and even overall fertilizer prices is that it may be difficult to increase again, and there is also a certain consensus on the expectation of a decline. Most people believe that it may be difficult to have a significant decline before the Spring Festival. In the near future, we mainly need to pay attention to the sales situation of high cost and high price compound fertilizers, and their quality may determine whether the downward trend of fertilizer prices will be delayed or arrived earlier.