China’s domestic 57% DAP prices continue to rise on strong demand

29 July 2011 13:01  [Source: ICIS news]

SHANGHAI (ICIS)--Offers for 57% diammonium phosphate (DAP) on the Chinese domestic market have reached yuan (CNY) 3,050/tonne EXW (ex-works), up by CNY50–100/tonne in the past month on strong demand, industry sources said on Friday.

Currently, Chinese producers are providing a limited supply of 64% DAP to the domestic market because they have been focusing on exports since 1 June. One producer says most of its products are supplying the export market.

There are two factors stimulating the 57% DAP market. Firstly, domestic traders are choosing to purchase 57% DAP because some small plants that have not signed any export contracts are able to supply the domestic market to some extent.

Secondly, the wholesale price of 57% DAP is lower than that of 64% DAP, which makes domestic buyers more likely to accept 57% DAP prices.

Wholesale prices of 64% DAP are mostly in the range of CNY3,450-3,650/tonne in some districts in northern, eastern and northwestern China, where DAP is used in the wheat-planting process at the end of September and in early October.

Many Chinese users feel that the DAP price is too high for them following its considerable increase since last year.

By: Jody Pond

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