Price trend

Last week (August 18-22), the liquid ammonia market in Shandong Province remained sluggish, with prices continuing their downward trend from last week’s previous week, albeit at a slower pace. According to the SunSirs Commodity Market Analysis System, prices in Shandong, the main producing region, fell by 0.72% last week.

Analysis review

The main reason was that supply pressure remained difficult to alleviate, and market inventory was excessive. With some maintenance equipment operating, the supply side appeared to be loose. Furthermore, many manufacturers increased their ammonia conversion capacity, and accumulated liquid ammonia inventory continued to put pressure on manufacturers. Manufacturer prices gradually loosened during the week, and as the weekend approached, prices at major Shandong manufacturers fell by around 100 RMB/ton. Distributors were mainly under-quoting shipments. Furthermore, downstream purchasing enthusiasm was low, agricultural demand was still in the off-season, and industrial demand remained rigid, resulting in an overall bearish outlook on the demand side. As of August 22, the mainstream quote in Shandong was between 2,250 and 2,400 RMB/ton.

Market outlook

The recent low utilization rate of compound fertilizer production, a downstream product of liquid ammonia, and the limited recovery in phosphate fertilizer production have further constrained liquid ammonia demand. Agricultural and industrial demand was primarily driven by rigid demand. Future supply fluctuations are expected to be minimal, with manufacturers operating at varying intervals, and ammonia supply remaining primarily balanced. Liquid ammonia is expected to remain weak and volatile.

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