CCM-The 4 Factors Influencing Glyphosate Prices in China in Q4 10-27-2015

As China’s pesticides industry gathers in Shanghai for this year’s AgroChemEx, CCM analyzes the factors shaping glyphosate prices in the world’s biggest market for agrochemicals...



2015 has been a tough year for China’s glyphosate market so far. With weed resistance to the herbicide increasing around the world, some buyers are beginning to turn to other products or mixed formulations, and Chinese producers are feeling the effects.


Ex-works prices for glyphosate technical (TC) kept falling during the first half of the year and have hovered at around just RMB19,300/t since July, according to CCM’s price monitoring data.


But will the picture brighten for manufacturers as we move towards the new year? Here are the four factors that will determine what happens to glyphosate prices over the next few months:


1. Glyphosate TC manufacturers’ sheer determination not to drop prices further


Since July, most Chinese glyphosate TC manufacturers have dug their heels in and refused to lower their prices further, keeping prices stable at around RMB19,300/t.


Some producers have even started to nudge prices upwards a little bit, including Sichuan Fuhua Tongda Agrochemical Technology Co. Ltd. and Zhejiang Jingma Chemicals Co. Ltd., who both raised their prices RMB500 in September.


“Glyphosate TC prices have dropped very low, and most manufacturers are unwilling to down-regulate prices again,” commented Wang Jianwo, Secretary General of the Pesticide Industry Association of Hunan Province.


2. The ‘October bounce’


Chinese pesticides manufacturers often enjoy a ‘bounce’ in demand in October, as the pesticide industry enters the off-season.


It is common for both manufacturers and traders to stock up on products during the slack season in preparation for the spring selling season.


“Based on previous years, the arrival of the off-season will increase demand for glyphosate in the near future, to some extent,” commented Chen Zaoqun, Editor of Glyphosate China Monthly Report. “It’s possible that glyphosate prices may even rise a little during this period.”

And AgroChemEx 2015, taking place from October 28-30, may itself have an effect on prices. The exhibition always attracts large numbers of manufacturers and foreign traders, and Chinese agrochemicals firms pay a lot of attention to this event.


According to Chen, some manufacturers may be tempted to raise prices during AgroChemEx:


“Before the event, many agrochemicals enterprises will stabilize or even increase their quotations for pesticides, so as to give traders the impression that prices will continue to grow,” said Chen.


“If purchasers show a strong desire to purchase products, or manufacturers receive plenty of orders or cooperative agreements, the agrochemicals enterprises are also likely to raise prices after the meeting,” Chen added.


3. Increasing supplies


Despite these positive signs, there is no escaping the fact that most glyphosate manufacturers and traders currently have sufficient inventories and are mainly selling products from their inventories.


What’s more, glyphosate output in China is likely to increase even more over the next few months as several producers resume production after shutting down for equipment maintenance, and Sichuan Hebang Biotechnology Co., Ltd. opens its newly-built 50,000 t/a glyphosate TC project.


4. Low raw materials prices


Another sign that there is room for glyphosate prices to fall further is that prices for intermediate products such as glycine, IDAN, and PMIDA are stagnant, or in some cases still falling.


In some downturns, high raw materials prices act to push up the prices of downstream products despite demand remaining low, but in the case of glyphosate this looks unlikely to happen for now.


The average ex-works price of glycine in China fell to RMB9,000 in October, down RMB500 from September, according to CCM’s price monitoring data, while IDAN prices are at their lowest level in two years, also at around RMB9,000.


“The gloomy glyphosate market and the stagnant markets for its intermediate products are influencing each other,” commented Chen. “Glycine and IDAN prices are falling, while the prices of other raw materials and intermediates remain stable, meaning that there is no upward pressure on glyphosate prices coming from upstream.”


“In fact, it may get even worse, for it may drag the price of glyphosate down,” Chen added.


More information about glyphosate in China:

If you are looking for more detailed intelligence on China’s glyphosate market, take a look at some of our latest research below:


Industry Reports - for a detailed overview of the market and long-term market forecasts, see our latest Glyphosate Industry Reports


Market Data - get regular updates on the price, production, consumption, manufacturing costs and leading producers of glyphosate in China with our Market Data service


Trade Analysis - you can find detailed data on every Chinese glyphosate supplier and trader, and what specifications and prices they are offering, in our Export Analysis reports


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