Source: vtv.vn
With slow fertilizer consumption demand in most regions while domestic production remains at high capacity and imported fertilizers are still delivered to Vietnam, fertilizer price The types on the market tend to decrease slightly, especially the leading type is urea fertilizer.
As of early August, the amount of fertilizer consumed for the Summer-Autumn rice crop is estimated at about 750-830 thousand tons, equivalent to about 98% of total demand. Currently, only about 2% of total fertilizer consumption remains unused for fertilizing the Summer-Autumn rice crop, scattered in the coastal provinces of Soc Trang, Kien Giang, Long An, Tra Vinh, Bac Lieu, Ca Mau and Ben Tre. Of which, the demand for DAP has been completed, the demand for potassium is about 6%, the demand for NPK is about 3% and the demand for urea is about 2%.
In the North, the provinces are still in the rice planting phase, however, many areas continue to have heavy rain this week, delaying fertilization activities. In the Central region, the Summer-Autumn rice crop in the Central provinces has completed the fertilization phase, the demand has almost stopped, currently there is little demand for flowers and fruit trees. In the Southeast and Central Highlands, industrial crops have mainly passed the peak of the first fertilization phase in the rainy season, so the demand has slowed down. It is expected that around mid-August, industrial crops will need the second fertilization phase.
Meanwhile, urea fertilizer output Production in July reached about 205,000 tons, an increase of 10,000 tons compared to June. At the same time, the amount of urea imported in July also reached 30,000 tons. Urea inventory at the end of July was estimated at 389,000 tons, an increase of 38,000 tons compared to the end of June.
Therefore, urea prices in the last week of July tended to decrease in most regions when two factories in the North reduced their order prices by VND200/kg from July 27, although Ca Mau Fertilizer Plant kept its order prices unchanged from July 26.
For DAP fertilizerthe import of this type of fertilizer is quite active when 21,500 tons were imported to Vietnam in the last week of July from July 24 to July 30. It is expected that in August and September, there will continue to be a number of DAP ships delivered to Vietnam. As of the end of July, DAP inventory is estimated at 263,000 tons, an increase of 29,000 tons compared to June in the context of quiet DAP transactions and stable selling prices of DAP types compared to the previous week.
For NPK compound fertilizers, imported NPK offers were stable, while domestically produced NPK offers increased slightly amid NPK inventories as of the end of July at 509,000 tons, down 53,000 tons compared to June.
Boosting exports as domestic demand declines
Domestic fertilizer manufacturers are boosting exports, taking advantage of the time when world fertilizer prices are increasing.
To operate effectively when the domestic demand for fertilizers for agricultural production is not high, fertilizer manufacturing enterprises in Vietnam have boosted exports, taking advantage of the time when world fertilizer prices increase due to increased demand for fertilizers for crops.
According to reliable data from Vietnam Market Research and Forecast Joint Stock Company (a company that domestic fertilizer manufacturers are using market data to serve production management), the operation Fertilizer export has slowed down since the last week of July, with more than 6,800 tons of urea (Phu My urea, Ca Mau urea and Ha Bac urea) exported, down 4,000 tons from the previous week.
Statistics from the international market research company Argus also show that the current shortage of Chinese urea in the export market has caused the bid price of granular urea to reach 370 USD/ton FOB in Indonesia, but the loading at Bontang port is still delayed. (FOB price is the price at the border gate in the seller’s country, including all costs of transporting the shipment to the port, export tax and export clearance tax).
In markets west of Suez, Brazilian granular urea prices remained unchanged at $355-360/mt CFR (CFR is the price at the exporter’s gate plus freight) as limited demand from Europe and the US hampered price recovery.
Demand for urea is expected to be stronger from the European and US markets from September. Demand is picking up in some Asian markets as some purchase tenders have been issued in Sri Lanka, Pakistan, etc. and an Indian urea import tender is expected to be issued in the next week or two. Trading activity in the Americas is muted. US/Brazilian granular urea prices are generally down by USD 3-7/mt/st compared to last week.
According to Ca Mau Petroleum Fertilizer Joint Stock Company (PVCFC), the company always prioritizes supplying fertilizers in the domestic market, meeting the fertilizer demand for agricultural production, ensuring national food security. However, during low-season periods, PVCFC will focus its business on the world market, seeking export opportunities not only for its main products but also for other chemical fertilizer groups.
Currently, the world’s major fertilizer consumers such as China, India, the US, Brazil and Europe are simultaneously re-bidding to ensure fertilizer supply. China and Russia have also extended the period of fertilizer export restrictions. Therefore, this is an opportunity for Vietnamese enterprises to boost exports when domestic demand is low. With existing advantages in over 18 countries around the world, PVCFC continues to boost exports to the markets it has dominated and expands penetration into new markets.
To realize the export promotion goals, DCM has been investing in expanding production and business activities; developing port and warehouse infrastructure, logistics, ensuring shortened time and optimized transportation costs. In addition, DCM also implemented solutions to increase safe factory operating capacity by 10%-20%.
Similarly, PetroVietnam Fertilizer and Chemicals Corporation (PVFCCo) continues to operate fertilizer factories efficiently, safely and stably; prioritizing cost reduction and product quality improvement. PVFCCo also continues to closely monitor market developments, strengthen forecasting to make optimal business decisions. At the same time, PVFCCo is also considering transforming its business model and distribution system to suit the market context. In addition, PVFCCo aims to seek and take advantage of all export opportunities to India, South Korea, Japan, Thailand, Taiwan (China) and the Philippines to reduce oversupply pressure from the domestic market during the low season.
