Due to the serious overcapacity in domestic chemical fertilizers and the weakening of domestic demand under persistently abnormal weather in the country, the fertilizer market did not flourish in 2010, especially urea even experienced price inversion. This eventually led to the implementation of the state-owned fertilizer enterprises in 2004. For the first time since the reserve system, it has lost money.
However, in 2010/2011, the reserve of chemical fertilizers has started to be tendered, and companies are generally worried about whether it is necessary to continue to implement the fertilizer depletion. China Chemical Network analysts believe that the reserve of chemical fertilizers is still necessary, and that storage enterprises should still be optimistic. Mainly because:
(1) In the peak season of domestic fertilizer demand, the transportation and transportation of fertilizers need macro-control, so reserves must be prepared in advance;
(2) Under the energy conservation and emission reduction advocated by the government, the domestic oversupply of nitrogen fertilizer and compound fertilizer will be further alleviated. From January to August data, nitrogen fertilizer and urea are all lower than the same period in 2009;
(3) Under the reduction of production capacity and recovery of demand, fertilizer prices for spring plowing in 2011 are expected to be higher than current prices.
However, in 2010/2011, the reserve of chemical fertilizers has started to be tendered, and companies are generally worried about whether it is necessary to continue to implement the fertilizer depletion. China Chemical Network analysts believe that the reserve of chemical fertilizers is still necessary, and that storage enterprises should still be optimistic. Mainly because:
(1) In the peak season of domestic fertilizer demand, the transportation and transportation of fertilizers need macro-control, so reserves must be prepared in advance;
(2) Under the energy conservation and emission reduction advocated by the government, the domestic oversupply of nitrogen fertilizer and compound fertilizer will be further alleviated. From January to August data, nitrogen fertilizer and urea are all lower than the same period in 2009;
(3) Under the reduction of production capacity and recovery of demand, fertilizer prices for spring plowing in 2011 are expected to be higher than current prices.
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