China is the world's largest fertilizer producer and the largest fertilizer consumer. The impact on the Chinese market will directly affect the global fertilizer market. The Chinese market was the first to be affected by this outbreak. In the early stage of the outbreak, for the purpose of outbreak prevention and control, factory shutdowns, logistic stagnation, and trade disruptions had a major impact on fertilizer production, transportation, and trade in the first quarter.
Fortunately, the epidemic in China was quickly brought under control. In mid-February, the National Development and Reform Commission and other 16 departments jointly issued a document requesting all localities to do a good job in supplying fertilizers for spring farming in 2020, including Hubei’s The fertilizer companies in the company have overcome difficulties and resumed production and production, effectively guaranteeing the fertilizer for spring farming.
At present, China's domestic fertilizer market is generally stable, and its operating rate has increased slightly compared with the same period last year. However, considering the medium- and long-term impact of the epidemic on the consumer market, the demand side still faces greater uncertainty. It is embodied in the following aspects:
1. Growers generally lack confidence in the prices of agricultural products, which restricts the enthusiasm of fertilizer input, resulting in a decline in fertilizer demand compared to previous years;
2. In industry, affected by the epidemic, the demand for fertilizer on the industrial side has declined;
3. At present, the trade exchange activities represented by the exhibition are still basically in a stagnation state, and the import and export data of fertilizers have declined in the first quarter;
4. The development of overseas epidemic situation has affected the agricultural labor force in some areas, forcing the major players in the fertilizer field to formulate corresponding strategies and policies to develop innovative and advanced products, such as slow and controlled release fertilizers to improve nutritional efficiency and save labor. Water-soluble fertilizers, etc., the increase in R&D investment of major companies and the rapid transformation from traditional fertilizers to special fertilizers will drive the market growth of new fertilizers.
Globally, the number of confirmed diagnoses in other countries, except China, continues to grow. The WHO's daily epidemic report shows that as of June 16, Central European Time, the new coronary pneumonia epidemic has spread to more than 200 countries and regions around the world, with more than 8 million people diagnosed.
Although the spread of pandemics has slowed in some countries and the number of cases has decreased, in others, COVID-19 is reappearing or continuing to spread rapidly. This is still a global problem that requires a global response.
In India, the impact of the Covid-19 pandemic on fertilizer production capacity is widespread, resulting in the complete closure of some factories or a decrease in operating rates. Fertilizer factories across India are also facing pressure from logistics restrictions, including road closures, insufficient truck drivers, and failure to deliver Finished products lead to increased inventory and labor shortages at production plants.
The coronavirus pandemic has threatened more than 100 million hectares of crops in India. However, as the outbreak began to coincide with the peak of the harvest season in India, there is currently no shortage of fertilizers.
India is an important fertilizer exporter to China. Since India’s demand for fertilizers from China is more rigid, the impact of this epidemic on China’s fertilizer exports to India will be limited in the short term; in recent weeks, India’s purchases have been strong. Argus estimates that India’s total imports of DAP from June to July will be approximately 1.7 million tons.
With the recent release of the blockade measures, the number of confirmed outbreaks in India is rising again. This is a bad sign. If the outbreak continues to develop, it will hit the already traumatized agriculture again. On the one hand, it will have an impact on agricultural product transactions. Due to the blockade of the market and the blocking of agricultural product trade, agricultural product prices have fallen; on the other hand, due to the impact of the international market transportation obstruction, it is expected that the fertilizer trade will continue to be affected; Reverse migration also causes a shortage of labor in the agricultural sector, which will cause damage to agricultural operations in many areas.
In Africa, about 650-670 million people already face food insecurity, accounting for about half of the total population of Africa. Among them, more than 250 million people are considered serious food insecurity. According to the epidemic data released by the African Center for Disease Control and Prevention on June 16, the cumulative number of confirmed cases of new coronary pneumonia in Africa reached 252,544, with a total of 6,779 deaths. After the Covid-19 pandemic, the number of people facing severe hunger in Africa may double.
With the support of the United Nations, the Norwegian government and African institutions, Yara launched the "Prospering Farms, Prospering the Future" African Action Plan. The action plan intends to provide local agricultural producers with mineral fertilizers and related digital solutions, as well as information and pesticide support to ensure food security after the global economic crisis caused by the Covid-19 pandemic. Yara is taking action, promising $25 million to provide food for more than 1 million people in southern and eastern Africa. Uralkali, a Ural potash company, also joined the plan.
At present, as the European epidemic continues to slow down, many European countries have successively adjusted their national epidemic prevention policies and further relaxed restrictions. Madrid, Spain has entered a second stage of emergency downgrade; the British government announced measures to "unblock" large-scale outbreaks; France June 15 Japan opens its border to the EU;
In terms of fertilizers, the strict regulations on the use of synthetic fertilizers by European governments and the increasing popularity of organic fertilizers have driven the growth of the European organic fertilizer market.
However, during the outbreak of the COVID-19 pandemic, delays and interruptions in the borders of various countries caused by the blockade affected the transportation and delivery of organic fertilizers in the European market. The goal of the European Union is to increase food production to ensure the next season’s food in the region Safety, which will increase its demand for chemical fertilizers.