Amsul export is CIQ required
Yellow phosphorus rebounded slightly after a continuous slump. Weekly avg. price rose from CNY26,229/t to CNY26,446/t (+0.83% WoW). Rainy season brought lower electricity cost in southwest China. Previous maintained production lines resumed production and lifted supply moderately. Manufacturers were reluctant to sell at low prices and firmly held quotations. Demand remained sluggish, downstream sectors like hot-processed P.A., glyphosate and phosphorus trichloride only purchased upon rigid demand cautiously. Phosphate rock offered some cost support, while fluctuating sulfur prices weakened the competitiveness of wet-processed P.A.. P4 price would fluctuate within narrow range.
Sulfur benchmark price rose from CNY9,119/t to CNY9,236/t and stabilized late in the week. Repeated geopolitical tensions in the Middle East disrupted shipping through the Strait of Hormuz. Import offers stood at USD1,100-1,130/t CFR China, and inbound cargoes faced delivery delays. Port inventory remained low, prompting holders to hold firm on quotations. Refineries in East China generally start summer maintenance, cutting domestic liquid sulfur supply and lifting bidding prices. Downstream demand is limited, high sulfur prices restrained purchasing intention. The market will keep narrow high-level swings.
Phosphoric acid saw divergent trends between hot and wet processed grades. The EXW price of 85% hot P.A. hovered around CNY9,100/t, fluctuating narrowly as yellow phosphorus stopped falling. Resumed yellow phosphorus facilities boosted raw material supply and weakened cost support, pressuring producers to clear stocks. Wet P.A. stayed firm at high levels backed by elevated sulfur prices and reduced operation rates at some plants, narrowing price gaps with hot P.A.. Downstream demand remained sluggish: summer phosphate fertilizer demand faded while autumn fertilizer restocking had not kicked off. The other downstream users like electronics and detergent sectors only purchased rigid demand with cautious sentiment with limited qty. The market will likely maintain divergent narrow swings.
Urea market fluctuated downward. Spot EXW price dropped CNY30-80/t WoW, while the main futures contract fell from ~CNY1,750 /t to ~CNY1,687/t. Operation rate stayed >91% with daily output over 210kt. In-factory inventory surged 14% WoW to 1,408.9kt, weighing heavily on market pricing. Summer agricultural topdressing demand faded, only cotton fertilization in Xinjiang offered limited support. Compound fertilizer operation rate stood below 30%, industrial buyers remained cautious with small rigid orders. Export profit turned negative due to price gap, slow port delivery failed to ease domestic supply pressure. Coal prices provided cost support; most plants suffered losses, so manufacturers resisted sharp price cuts. In the short term, high inventory and sluggish demand dominate the market. Urea will keep weak narrow swings with limited sharp ups or downs.
Amsul edged up after initial stability. The benchmark price climbed from CNY1,133/t to CNY1,150/t. Supply stayed steady both for coking and caprolactam grades. Major manufacturers lifted offers mid-week to shore up prices. A critical factor is mandatory customs inspection (CIQ) starts since Jul 16, customs clearance time will be extended and export shipments will be postponed as it normally takes 3-4 weeks for CIQ. Intl’ market, weak global urea price eroded Amsul’s cost competitiveness, foreign buyers stayed hesitant. High sulfur prices offered bottom support, restraining sharp price cuts. In the short term, new export rules and sluggish domestic demand counterbalance each other. Amsul will likely fluctuate narrowly at low levels with limited upward momentum.
