There are three reasons influencing the price uptrend - the continuously increasing demand, impacted production and increasing production cost.
China's demand for yellow phosphorus kept stable increase during 2005-2010. During this period, the apparent consumption volume of yellow phosphorus increased by CAGR of 5.5% in China and it grows even faster in 2011. As of August in 2011, China's yellow phosphorus apparent consumption volume has reached 475,758 tonnes, up by 6.4% year-on-year compared with that in the corresponding period last year.
Generally speaking, price of yellow phosphorus is supposed to be down in H2 2011 because yellow phosphorus production is booming in this period. But things are different in 2011. In the regular wet season, the main yellow phosphorus production provinces in China suffer serious drought which causes wide electric power shortage. As the direct result of the power shortage, yellow phosphorus production is impacted. Government indicated that the power shortage situation will sustain throughout the winter this year, which means production will be down in H2 2011
Meanwhile, yellow phosphorus also sees rising in production cost, especially the increasing price of phosphorus ore. Since January 2010, price of phosphorus ore has kept in high level and seen fluctuating increase. The phosphorus ore price was obviously increasing in June 2011 when Hubei Province and China Petroleum and Chemical Industry Federation (CPCIF) promulgated their integrating guidelines of phosphorus ore resource. Phosphorus ore price is expected to keep the uptrend with the deep industry integration in the remainder of 2011.
Headline news of October of Phosphorus Industry China Monthly Report:
-Phosphorus industry develops in an orderly way in Zhongxiang City.
-Iraq becomes the second largest phosphate rock region instead of China in the world.
-Kailin Group pays more attention to technology innovation.
-Ministry of Commerce releases that the 2nd export quota for phosphorus is 600,000 tonnes in 2011.
-Downstream fine phosphate chemicals see increase in average export price.
-Price of yellow phosphorus is expected to keep the uptrend in the remainder of 2011.
-New Discharge Standard of Water Pollutants for Phosphate Fertilizer Industry (GB15580-2011)
-Numerous phosphate fertilizer producers pay more attention to the utilization of phosphogypsum by the pressure of policy.
-Shindoo is to develop low release compound fertilizer for strengthening competitiveness.
-Entry Criteria for Phosphate and Ammonium Industry takes effect in Sep. 2011.
-Hubei energetically develops fine phosphate chemical industry.
-Price of phosphorus products continues rising in Sep. 2011.
If you are interested in CCM’s Phosphorus Industry China Monthly Report, please feel free to contact us at email@example.com.
(Guangzhou China, October 17, 2011)
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