Potassium Sulfate prices in China have been dipping amidst high supplies and low overall demand
Prices of Chinese potassium sulfate has witnessed a steady decline recently, a trend largely influenced by the falling cost of potassium chloride, a key raw material. This situation has persisted despite the normal production rates maintained by resource-based potassium sulfate manufacturers who have been diligently executing pre-existing orders. The varying transaction activities across regions hint at a short-term outlook where market prices are expected to remain weak and on a downward trajectory.
The decline in potassium sulfate prices has further been dragged down by an ample supply that has not been matched by sufficient demand from downstream factories. The operating rate of processing manufacturers has stayed relatively high at around 70%, yet there has been no notable increase in procurement from the downstream sectors. Moreover, there have been no uplifting dynamics from water-soluble fertilizer factories as they, too, have only placed small orders.
Moreover, the Mannheim potassium sulfate segment, heavily reliant on potassium chloride, has seen price reductions in line with the decreased cost of its primary raw material. Despite high operational rates, the downstream demand from compound fertilizer factories has waned, with many opting to commence their Spring Festival holiday earlier than usual, resulting in cautious raw material replenishment and high inventory pressures.
In the midst of the Spring Festival, logistical and labor challenges led to some stockpiling by downstream factories and traders, aiming to secure raw material supplies. This period of adjustment reflects the market's response to external pressures and the ongoing struggle to balance supply with fluctuating demand. Amidst these challenges, the potassium sulfate market in China continues to navigate through a phase of price adjustments and cautious procurement strategies.
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According to Procurement Resource, the Chinese potassium sulfate market has seen declining prices due to falling potassium chloride costs, despite steady production by resource-based manufacturers. With a supply surplus and low demand from downstream sectors, including water-soluble fertilizer factories placing minimal orders, prices are expected to remain weak.
The Mannheim segment, dependent on potassium chloride, also faces reduced prices amid cautious procurement and high inventory pressures. Pre-Spring Festival stockpiling attempts to mitigate logistical challenges have not offset the overall downward price trend, reflecting ongoing market adjustments and cautious strategies.
