Phosphoric Acid price surged in March amid positivity in fertilizer market and strong supplier’s action
Phosphoric Acid price surged in March amid positivity in fertilizer market and strong supplier’s action

Phosphoric Acid price surged in March amid positivity in fertilizer market and strong supplier’s action

  • 10-Apr-2024 2:14 PM
  • Journalist: Patricia Jose Perez

In the USA market, there has been a notable surge in the price of Phosphoric Acid in March, largely driven by increased demand from the downstream fertilizer market. Market participants are actively stimulating purchasing activities of Phosphoric Acid, seeking to signal a retracement in the previous downward price trend. This uptick in price indicates a potential shift in market dynamics. However, it's important to note that the potential for a full trend reversal in the Phosphoric Acid market remains uncertain. Suppliers are closely monitoring price movements and are poised to initiate bulk accumulation of Phosphoric Acid inventories in the upcoming month.

In the US market, the price of Phosphoric Acid stabilized at $1000 per metric ton FOB-Texas, reflecting a 0.50% increase. Recent data from Mosaic, a major fertilizer manufacturer, suggests that first-quarter sales volumes for phosphates are expected to align with previous guidance, ranging from 1.6 to 1.8 million tonnes. This estimate includes quantities of low-margin products procured from third parties to mitigate the impact of scheduled turnarounds in the first half of 2024. However, Mosaic's Riverview facility experienced limited ancillary damage from a recent brushfire, with production impacts anticipated to persist for four to six weeks. Additionally, the US Department of Agriculture announced a $124 million investment in renewable energy and fertilizer production projects across 44 states, aimed at reducing energy costs and fostering economic growth in rural areas.

In the USA, the fertilizer market, particularly for Diammonium Phosphate (DAP), is experiencing a notable surge in demand. Reports indicate that US phosphate buyers are accelerating their procurement of DAP due to dwindling phosphate supplies at inland terminals. Conversely, indications for Monoammonium Phosphate (MAP) remain steady. Traditionally, DAP sees heightened demand during the spring season, while MAP is preferred in the fall. Moreover, the broader manufacturing sector is showing positive signs, with the ISM Manufacturing Purchasing Managers' Index (PMI) rising to 50.3 in March 2024, indicating the first expansion in 16 months. This expansion is evidenced by various factors, including an uptick in the new orders index, signaling increased demand. These market dynamics collectively impact the demand for Phosphoric Acid in the US market.

According to ChemAnalyst's projections, Phosphoric Acid prices are expected to exhibit bullish momentum in the short term. This expectation aligns with the positive trends observed in the regional fertilizer sector, thereby influencing demand for Phosphoric Acid. The short-term outlook is based on market participant's actions, which include destocking of Phosphoric Acid inventories, leading to a downturn in prices. The recent uptick may be viewed as a retracement in price action, with a lower potential of trend reversal for a long-term upward trajectory in Phosphoric Acid prices. These factors collectively may impact Phosphoric Acid price fluctuations in the near future.

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