Throughout the first half of 2024, prices for ammonium sulfate have shown stability with some fluctuations. For instance, in January, the ex-works price of coking ammonium sulfate in Shanxi Province ranged between 760 and 860 RMB ()per ton, while by June, the price for ammonium sulfate (caprolactam grade first-class product) in the Guangzhou market stabilized around 1050 RMB per ton. These price changes reflect variations in supply and demand across different regions and seasonal demand impacts.
The global political and economic environment has direct and indirect effects on the fertilizer market. In 2024, the world economy continued its recovery but faced multiple challenges, including inflationary pressures, risks of supply chain disruptions, and escalations in geopolitical tensions. Particularly, fluctuations in energy prices influenced production costs for fertilizers, while adjustments in trade policies could impact the import and export volumes of ammonium sulfate.
Agricultural demand is a critical determinant of fertilizer prices. With global population growth and shifts in food consumption patterns, the demand for high-quality crops has increased, thus driving up the need for efficient fertilizers. As an important nitrogen fertilizer, the demand for ammonium sulfate is influenced by crop planting areas and types. Moreover, rising production costs, such as raw material prices, energy expenses, and transportation costs, may be passed on to the final product's price.
Uncertainties in international trade policies, such as changes in tariffs, export quota restrictions, or subsidy policies, can significantly affect the international market price of ammonium sulfate. Currency fluctuations are also crucial since most international transactions are denominated in U.S. dollars; the strength or weakness of the dollar directly impacts purchasing power and export competitiveness of non-dollar countries.
Geopolitical events, such as conflicts or sanctions, may lead to supply disruptions in specific regions or countries, triggering price volatility. For example, instability in the Middle East or North Africa could affect major exporting countries of ammonium sulfate, impacting the global market supply balance.
Given these factors, forecasting future price trends for ammonium sulfate requires caution. While current prices exhibit a certain level of stability, uncertainties such as the strength of global economic recovery, political stability in major oil-producing countries, and impacts of climate change on agriculture could cause price fluctuations.
In the short term, prices for ammonium sulfate are likely to continue being influenced by seasonal demand, production costs, and trade policies. Over the long term, if the global economy continues to recover and agricultural demand steadily grows, prices for ammonium sulfate might remain firm or even rise. However, any sudden geopolitical event or natural disaster could disrupt this trend, leading to unpredictable price movements.
Investors and industry participants should closely monitor the development of these key factors to adjust their strategies promptly in response to potential price volatility.
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