The price of phosphate rock has remained high since April, and the price decline of urea, fertilizer and ammonium phosphate has gradually narrowed, and the market has shown a trend of stabilization. Recently, the Ministry of Industry and Information Technology and other seven departments jointly issued the "Action Plan for the Comprehensive Utilization of Phosphogypsum", which provides guidance and impetus for the progress of the phosphorus chemical industry, and has a positive impact on the long-term development of the industrial chain.
In addition, the rigidity of downstream phosphate fertilizer demand and the growth of demand for new energy materials jointly promoted the rise in phosphate rock prices.
Overview of the phosphorus chemical industry
Phosphorus occupies an important position in industrial and agricultural production, and is mainly stored in phosphate rock in the form of phosphate in nature.
In the phosphorus chemical industry chain, phosphate rock is used as the starting point, and the downstream applications include two process routes: thermal and wet.
The thermal method obtains yellow phosphorus by burning phosphate rock and coke at high temperature, and then further processes it into thermal phosphoric acid, and the wet method obtains wet phosphoric acid through the reaction of phosphate rock and sulfuric acid, and the production of phosphate fertilizer belongs to this process.
From the perspective of downstream demand structure, phosphorus compound fertilizer has become the largest proportion with 70%.
Diagram of phosphorus chemical industry chain:
Phosphate rock is currently the only phosphorus resource that can be mined and applied on a large scale.
The continent is the world's leading producer of phosphate rock and phosphorus chemicals, accounting for 44% of the world's total production. However, the reserves are relatively limited, accounting for only 5% of the world's reserves, and the reserve-production ratio is only 35.
On the whole, the phosphate rock resources in the mainland are mainly poor ores, rich ores are relatively scarce, and the long-term supply capacity of phosphate rock resources is relatively weak.
In terms of regional distribution, the phosphate rock resources in mainland China are mainly concentrated in five provinces: Yunnan, Guizhou, Sichuan, Hunan and Hubei.
By the end of 2023, the total phosphate rock production capacity under construction or planning in China reached 35.5 million tons. It is expected that 15.7 million tons of new capacity will be added in 2025, and there are no plans for new capacity in 2024. The remaining planned capacity is expected to be operational in 2026. The new production capacity of phosphate rock mainly comes from Wengfu Group, Chuanheng Co., Ltd., Hubei Xiangyun, Xinyangfeng and other enterprises with phosphorus chemical supporting facilities.
At present, the domestic phosphate rock industry shows a high degree of industry concentration, and the price of phosphate rock remains at a high level.
In recent years, the over-exploitation of phosphate rock has been the focus of attention, and in order to protect phosphorus, a strategic resource, the government has successively introduced a number of environmental protection and production restriction policies. At present, phosphate rock mining is strictly controlled, and most phosphate rock enterprises are mainly for their own use, resulting in a tight supply of goods in the market and limiting the release of supply.
According to the data of Zhuochuang Information, among the domestic phosphate rock producers, Guizhou Phosphate, Yuntianhua and Xingfa Group are among the top three.
With the continuous high pressure of phosphate rock production restriction policy and environmental protection requirements, the production growth of phosphate rock will be limited, and its price is expected to remain at a high level.
High share of phosphate rock enterprises:
Source: USGC
The upstream phosphate rock is further processed into phosphoric acid through thermal or wet processes, and produces a variety of products such as phosphate and phosphate fertilizer, and can also be further converted into glyphosate, red phosphorus, organophosphorus, etc. through yellow phosphorus.
Phosphate fertilizer is a fertilizer with phosphorus as the main nutrient, which is directly related to food security, and its demand is relatively stable. At present, with the gradual elimination of backward production capacity in the industry, the price center of phosphate fertilizer is expected to maintain a high level.
In the product structure of phosphate fertilizers, monoammonium phosphate and diammonium phosphate occupy a dominant position, and others such as NPK compound fertilizers, heavy calcium and low-concentration phosphate fertilizers also have a certain market share. In recent years, due to the influence of multiple factors such as extreme weather and geopolitical factors, the sharp fluctuation of international food prices is expected to drive the steady growth of phosphate fertilizer demand.
According to the China Phosphate Compound Fertilizer Industry Association, domestic manufacturers Yuntianhua and Guizhou Phosphate are the leaders in phosphate fertilizers, in addition to Yonfer, Hubei Yihua and Hubei Xiangyun. #化工 ##化肥##磷##财经##矿石#
Phosphate fertilizer production pattern:
Source: China Phosphate Compound Fertilizer Industry Association
In terms of phosphogypsum, the current methods of phosphogypsum treatment by phosphorus chemical enterprises mainly include processing into gypsum building materials, soil conditioners, etc., with a large investment scale.
In recent years, due to the continuous growth of downstream demand for new energy vehicles and energy storage, the output of iron phosphate in mainland China has also achieved rapid growth. At present, the construction of many iron phosphate and its supporting purified phosphoric acid projects is accelerating. The successive commissioning of these projects will also promote the continuous rise in demand for phosphate rock in the field of new energy.
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