The global price of potash fertilizer continues to rise: at present, the price of global potash fertilizer products is rising. According to Baichuan Yingfu, as of April 2, 2022, the market price of potassium sulfate in China has reached 4539 yuan / ton, with a month on month ratio of + 8.61%, a year-on-year ratio of + 54.8%, and the market price of potassium chloride has reached 4340 yuan / ton, with a month on month ratio of + 11.6%, a year-on-year ratio of + 87.0%, In 2022, the potash fertilizer supply framework agreement signed between China and Canadian potash fertilizer suppliers for the next three years (20222024) agreed to be $590 / ton.
The export of major producers continues to be limited, and overseas prices jump: according to the Wall Street Journal and Argus, Russia is the world’s second-largest producer of potash. Since the end of February 2022, the geopolitical conflict between Russia and Ukraine has been heating up, which has a great impact on the transportation and export of Russian potash fertilizer products. In addition, in recent years, the EU and the United States have increased sanctions against Belarus, the world’s third-largest producer of potash fertilizer. Stimulated by the news of Russia’s termination of fertilizer export, the current overseas potassium fertilizer price has jumped sharply. According to Bloomberg, as of April 2, 2022, the CFR price of Brazilian granular potassium fertilizer has risen to US $1250 / ton, with a month on month ratio of + 52.4% and a year-on-year ratio of + 267.7%. The price of potassium fertilizer in New Orleans has risen to US $830 / ton, with a month on month ratio of + 24.8% and a year-on-year ratio of + 161.0%. The price of standard potassium chloride in Southeast Asia has risen to US $650 / ton, with a year-on-year ratio of + 132.1%.
China’s potash import demand has increased year by year, and the construction of overseas potash base needs to be accelerated and policy support. According to the State Food and Security Reserve Bureau, on March 6, 2022, Xi Jinping General Secretary further stressed that food security is “the largest country”, reflecting China’s increasing attention to food security. Potash fertilizer is a special commodity related to national food security, which is of great significance to maintain national food security. As a major consumer of potassium resources, China is highly dependent on the import of potassium fertilizer and has a trend of increasing year by year. In order to solve the problem of potash fertilizer shortage in China, in addition to potash fertilizer reserves, it is also necessary to explore and develop resources overseas and build overseas potash fertilizer bases. According to People.Cn Co.Ltd(603000) , at the two national sessions held in 2022, Ge Honglin, member of the Standing Committee of the CPPCC National Committee, said that China should vigorously support overseas potash bases to solve the problem of insufficient potassium resources in China. At the same time, relevant state departments should provide support for overseas potash projects in terms of financial, circulation and tax policies. In the future, with the continuous increase of national support, the construction of potash bases outside China is expected to accelerate.
Investment suggestion: in the future, with the continuous promotion of the construction of potash bases outside China, Chinese enterprises with potash production capacity overseas are expected to fully benefit. It is suggested to pay attention to: Asia-Potash International Investment (Guangzhou) Co.Ltd(000893) , Qingdao East Steel Tower Stock Co.Ltd(002545) .
Risk tips: the implementation of industrial policies exceeded expectations, and the development of International Geopolitics exceeded expectations
