12:34 | 19/08/2015 Trade
(VEN) - Domestic fertilizer prices have reduced since early July after a short local price increase. Fertilizer supplies and prices are expected to remain stable until the end of the year.
Fertilizer prices may remain stable until the end of the year
Fertilizer prices stabilized
Fertilizer prices in the Mekong River Delta have begun to fall after a short-term rise, especially including nitrogenous fertilizer.
According to Thu Dung, a Ben Tre Province-based first-level fertilizer agent, nitrogenous fertilizer prices rose slightly in June due to high demand during the summer crop while the Phu My Fertilizer Plant was conducting periodical maintenance. However, the maintenance has completed and it is now back on track again. Fertilizer supplies have so far strongly increased, contributing to stabilizing market prices. Currently, nitrogenous fertilizer is priced from VND8,400-8,800 per kg and potassium fertilizer from VND8,600-8,700 per kg.
At the Tran Xuan Soan wholesale market in Ho Chi Minh City, fertilizer prices decreased by VND200-300 per kg on average from the beginning of July. The downtrend in fertilizer price was also monitored at first-level fertilizer agents in the western region. Nitrogenous fertilizer prices currently average at VND8,300 per kg, cheaper when compared with the same time last year.
Most central provinces have completed fertilizing rice for the second and the third phases, so local demand for fertilizer remains low. Moreover, fertilizer supplies have strongly increased. Both have helped reduced fertilizer prices. For example, nitrogenous fertilizer prices have reduced by VND200-400 per kg. It was all the same for provinces in the Central Highlands where coffee farmers have completed fertilizing their plantations for the first phase.
Global nitrogenous fertilizer prices have dropped sharply after a period of increases. For example, the nitrogenous fertilizer price in Yuzhny (Russia) dropped to US$285 per tonne while sharp decreases were also seen in China and Sri Lanka.
According to the Petrovietnam Fertilizer and Chemicals Corporation (PVFCCo), the Phu My Fertilizer Plant began production on June 20, 2015 with a daily maximum capacity of 2,400 tonnes. In the first six months of 2015, PVFCCo marketed nearly 440,000 tonnes of nitrogenous fertilizer and more than 200,000 tonnes of other fertilizers. On July 7, it also received 27,500 tonnes of imported potassium fertilizer.
Fertilizer exports are increasing
Fertilizer exports have been increasing in the first six months of 2015. According to the Vietnam National Chemical Group (Vinachem), fertilizer export revenue in the first six months of 2015 reached US$71.3 million, a 60.1 percent increase over the same period last year. Particularly, NPK exports reached 107,000 tonnes, a 14.8 percent increase. Nitrogenous fertilizer, DAP and fused magnesium phosphate fertilizer reached 71,897 tonnes, worth US$28.8 million.
The high fertilizer export value recorded in the first six months of 2015 was due to effective marketing and sale promotion strategies by fertilizer companies in new markets including the Republic of Korea and Indonesia.
Boosting fertilizer exports have eased the burden on domestic fertilizer producers that were suffering from overstocking while improving revenues through the deduction of value added tax on exported fertilizers.