For the Quarter Ending December 2021
NORTH AMERICA
North American Phosphorous Acid market remained firm during Q4 2021 due to the consistent demand for the product from the downstream sectors. The growth for Phosphoric acid has become very moderate, and the demand has reached a maturity phase in several developed countries. Phosphorous acid has a great demand due to increased agricultural activities and certain rules & regulations imposed over them by the government. Because of progression in agricultural activities of Q4,2021 which resulted higher demand, affecting overall pricing dynamics. Thus, Q4 of 2021 has come to the closure by keeping firmness in prices of upstream and downstream products of phosphorous acid.
APAC
Asian market witnessed an upward trajectory in the price of Phosphorous Acid in the fourth quarter of 2021. The pandemic limitations, coupled with trade disruptions due to container shortages have hindered the supply chains in the region. Furthermore, rapid growth in the agriculture sector ahead of Rabi Season have further raised offers amidst soaring demand. Also, with shutdown of Ningbo Port in China due to the zero-tolerance policy in covid-19 have affected supplies in China. Natural gas crisis and Power rationing in China have curtailed production at some areas. Consequently, the prices of Phosphorous Acid maintained the upwards trajectory in the APAC region.
Middle East
After restriction over exports of DAP and its key raw material by Chinese authorities till second quarter of 2022, the demand for phosphorous acid presumed sky-scrapper in the fourth quarter of 2021. In the fourth quarter, Morocco shipped 100915.2 MT of Phosphoric Acid with a trade value of USD 100 million, resulting in an influx of queries from Indian downstream purchasers. As a result of the strong demand forecast, Phosphorous acid producers decided to raise price at the end of this quarter.
For the Quarter Ending September 2021
North America
In the North American domestic market, the overall demand outlook remained stable in the third quarter of 2021. The demand from the Fertilizers and insecticides sector remained dampened in this quarter. However, improvement in the offtakes from other downstream industries, including N-phosphonomethyl iminodiacetic acid (PMIDA) and Amino Trimethylene Phosphonic Acid (ATMP), kept the overall demand rate stable. Most of the production units remained shut for around two weeks as a repercussion of the hurricane Ida that made landfall in the US Gulf coast at the August end, which caused huge damage and power outages in the country. It consequently impacted the supply of Phosphorus Acid and led to the marginal hike in its prices in this quarter in the region.
Asia
During the third quarter, Phosphorus Acid prices soared in the Asian market owing to the inflation in the prices of upstream Phosphoric Acid and the robust demand from the downstream sectors. In India, Phosphorus Acid prices traced an upward trajectory backed by the consistent demand from downstream Agriculture and other sectors. As most of the Phosphorus Acid is imported from China, another factor that firmly supported the rise in Phosphorus Acid prices was the congestion on several China ports due to the shutdown of Ningbo port following the zero-tolerance coronavirus policy, which resulted in the disturbance in the supply chain. Moreover, exorbitant freight charges and unavailability of shipping containers also sent ripples to the prices of Phosphorus Acid in India during this quarter. Phosphorous Acid CFR-Kandla prices rose to USD 1214.96 per MT in September witnessed a hike of around USD 210 per MT since July, supported by the gap in Phosphorus Acid demand and supply in the region.
During the third quarter, Phosphorus Acid prices soared in the Asian market owing to the inflation in the cost of upstream Phosphoric Acid and the robust demand from the downstream sectors. In India, a major part of Phosphorus Acid is imported from China. The shutdown of Ningbo port in China following zero-tolerance coronavirus policy results in disruption in the supply chain. Demand for Phosphorous acid from downstream agriculture and other sectors was robust, and the supply chain disruption raised the price of phosphorus acid. Phosphorous Acid CFR-Kandla prices rose to USD 1214.96 per MT in September, which witnessed a spike of around USD 210 per MT since July, supported by the gap in Phosphorus Acid demand-supply fundamentals in the region.
Europe
European market also witnessed an upward rally in the pricing trend of Phosphorus Acid in this quarter owing to the constraint supply. Besides, an improvement in the offtakes from the downstream industries was observed this quarter. Moreover, lower production rates owing to the natural gas crisis further exerted pressure on the Phosphorus Acid market in Europe. Additionally, supply chain disruption as an impact of Ida hurricane and congestion on several ports of China also influenced the Phosphorus Acid prices in the global market. Some other factors, such as constantly increasing Freight charges and limited availability of shipping containers, further sent ripples to the values of Phosphorus Acid in Europe.
During quarter 3, phosphorus acid prices surged in the European market. Demand for Phosphorus Acid improved from downstream industries, but due to the energy crisis, production of Phosphorus Acid declined, which resulted in a price hike. Additionally, hurricane Ida and the shutdown of Ningbo port in China destabilized the market dynamics of Phosphorus Acid globally. Persistent factors, such as constantly increasing Freight charges and limited availability of shipping containers, further increase the values of Phosphorus Acid in Europe.
For the Quarter Ending June 2021
North America
Phosphorus Acid demand remained firm across North America region during Q2 2021. The demand for pesticides was high in the meantime, as the agrochemicals sector flourished following clear weather, which boosted the demand for several fertilizers and insecticides in the USA. The demand for the downstream derivatives like PMIDA (Phosphonomethyl Iminodiacetic Acid), and ATMP (Amino Trimethylene Phosphonic Acid) remained significantly high during this timeframe, which supported its prices. In addition, limited availability of corn across the region also exacerbated the overall demand for pesticides and herbicides in the meantime.
Asia
Asian market witnessed high demand for Phosphorus Acid during this quarter. The demand was mainly driven by agrochemicals sector. In China, prices rose due to the shortage of downstream insecticide Glyphosate in the country, which pushed manufacturers to increase the production of other insecticides to satisfy the overall demand in the domestic and global market. Meanwhile in India, the demand remained modest to firm during this quarter, bolstered by significant offtakes from the domestic agrochemicals sector. Moreover, no such significant impact of second wave of pandemic was observed on demand for insecticides. However, prices underwent a modest rise due to supply hurdles from China.
Europe
Europe also witnessed modest offtakes for Phosphorus Acid this quarter, bolstered by modest to low demand from the domestic agrochemical sector. European countries reduced the consumption of Glyphosate across the region due to environmental and health concerns. Therefore, it increased the demand for other insecticides and herbicides across the region, which ultimately increased the demand for Phosphorus Acid derived agrochemicals. In addition, some other factors like freight cost and transportation hurdles also affected the prices of agrochemical products in Europe.
For the Quarter Ending March 2021
North America
Demand for Phosphorus Acid remained narrow throughout the quarter across North America region. However, the demand from water treatment plants was observed sufficiently higher than other segments. Moreover, the demand from downstream glyphosate manufacturers remained low, as Glyphosate has been banned in several states of USA due to health and environmental concerns. In addition, in agriculture segment, demand for pesticides and herbicides remained low during this timeframe in North America.
Asia
In the Asian market, demand for Phosphorus Acid remained low, despite of plantation season in India and China. China is a leading producer and exporter of downstream Glyphosate, as it is one of the most favourable herbicides among Chinese farmers. However, ample supply activity across the region by China, deaccelerated the prices of Phosphorus Acid and its derivatives products. In the Indian market, prices remained low due to feeble demand from local agriculture segment till February end. In addition, experts anticipated that the demand may improve in Q2 after monsoon in India.
Europe
In Europe, some important decisions regarding downstream Glyphosate by several European countries affected the demand for Phosphoric Acid in this quarter. Last year, France announced regulations on using downstream Glyphosate, but later in December 2020, the French authorities announced that they will offer monetary aids to the farmers who will lessen the usage of Glyphosate. These decisions effectively reduced the consumption of Phosphorus Acid, regardless of arrival of spring season and booming agrochemicals market. The demand is further expected to go down, as several other countries are planning to stop using downstream Glyphosate.
Quarter ending result for December 2020
Asia
Major Asian countries like China and India have enough capacity for producing phosphorus acid and its feedstock PCl3. China is the leading producer of and exporter of downstream Glyphosate, which is a popular herbicide among farmers and produced using Phosphorus Acid. During Q4 2020, China faced no supply problem of Phosphorus Acid and traders saw more than enough availability of Glyphosate in the country. Buoyed by strong demand fundamentals and recovery from the COVID-19 pressure, the Indian Phosphorous Acid industry reported market gains during the quarter ending December. Prices of feedstock PCl3 scrolled down in effect of high supply from the manufacturers.
North America
In the North American region, several natural calamities badly impacted the Phosphorous Acid market outlook during Q4. The region witnessed multiple hurricanes all over the year which impacted the Cote Blanche mines, hurricane zeta in November also left bad impact on the mine’s activity which let to shortage of phosphorus-based minerals. The industry seemed to recover from the record low prices observed during Q2 in the fourth quarter, giving a sigh of relief to the industry players. However, the quarter ended with the announcement of the Mexican agricultural department that they will completely halt the usage of derivative glyphosate by 2024. This is likely to reduce the demand of phosphorus acid from the agriculture sector in Mexico in the coming years.
Europe
Demand for phosphorus acid remained pressured from the agriculture sector in several European countries. EU found that the usage of weedkiller glyphosate is carcinogenic, and they advised the countries to mark restrictions on its usage. In October 2020, France announced restrictions on the usage of downstream glyphosate, but later in December 2020, the French government announced that they will provide financial aids to the farmers who will reduce the usage of glyphosate. Eventually these decisions will impact the usage and demand of phosphorus acid from the agriculture sector. Overall, the market outlook remained well supported by prospects turning positive for other downstream sectors amidst strong economic revival expected post the vaccine roll out.
