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A Comprehensive Analysis of the Growing Global and China Potash Fertilizer Industry 2008

August 7, 2008

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The consumption of global potash fertilizer in 2007 recorded 37 million tons, major consumer countries such as China, the United States, Brazil, India and Southeast Asian countries consumed two third of global potash fertilizer, but the output of potash fertilizer in these countries accounted for only 9.0 per cent of global output.

80 percent of global potash fertilizer is for international trade. In terms of the shortage of potash fertilizer resources in China, East Asia, the United States, Latin America and South Asian, these countries import such a amount of potash fertilizer from Canada, Russia and Belarus, among South Asia countries are totally depend on import to support their demand of potash fertilizer, East Asia need to import 83 per cent of their demand and 84 per cent imported in Latin America; these three emerging markets consumed 16.37 million tons of potash fertilizer (calculated by pure) in 2006, accounting for 56 percent of global output, but, the output of their self-production was 2.37 million tons, the dependency ratio as much as 86 per cent. However, the pricing right of global potash fertilizer is controlled by BPC and Canpotex, the price of global potash fertilizer has been rising gradually.

China is the world’s largest potash fertilizer importer. The growth of import of potassium chloride maintained rising in 2007, but exports reduced substantially; the imports of various potassium chloride was 9.414 million tons, worth $2.29 billion, an increase of 33.5 and 57.2 per cent respectively than last year; annual export 59,000 tons, worth $16.5 million, decreased 80.3 and 75.2 per cent respectively than last year; the average import price was $243/ton, up 17.8 per cent than last year.

In 2007, China produced 3.1 million tons potassium chloride and 1.1 million tons of potassium sulphate, the total output of potash fertilizer was 2.55 million tons (calculated by pure K2O) and imported 5.55 million tons of potash fertilizer (pure), the ratio of dependency was 68 per cent. During Jan-May 2008 the output of China’s potash fertilizer was 891,500 tons, up 2.5 per cent than same period last year. In terms of the lack production of potash fertilizer, China will remain high dependency ratio in the future.

China imports nearly half of its demand of potassium chloride from Russia. In 2007, China imported 3.8515 million tons from Russia, up 11.4 per cent than last year, accounting for 40.9 per cent of its total imports; the average price was $241/ton, up 17.8 per cent than last year. China imported 60 per cent of its total potash fertilizer from Russia and Belarus, mainly from the BPC; 27 per cent from Canada, mainly from Canpotex.

The growth demand of potash fertilizer in China is expected to increase 8 per cent in 2008, total 8.2 million tons (pure), and among about 5.8 million tons (pure) need import and converted to 9.5 million tons of potassium chloride. The contracts with Canpotex, BPC, ICL, APC of potash fertilizer of 2008 are 2.5 million tons, the inventory of 2007 is about 3 million tons, therefore, the shortage is 4 million tons in 2008, which need to rely on imports. So the large spot demands will maintain or continue to push up the price of potash fertilizer in the domestic and international market.

Key Topics Covered:

– Variety of major potash fertilizer product

– Analysis of supply and demand of global market

– The rising price of potash fertilizer caused by global food crisis

– The supply and demand of China market

– The development treads of potash fertilizer industry

– Analysis of key companies

– List of Figures

– List of Tables

Companies Mentioned:

– CITIC Guoan group

– Xinjiang Guannong Fruit & Antler Co., Ltd (Guan Nong Share)

– Qinghai Salt Lake Potash Co,. Ltd

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