CCM: Will China's paraquat market meet new changes after 1 July, 2016 09-20-2016

Paraquat AS is going to be banned from the Chinese market and the price of paraquat still keeps falling. Currently, there are no more positive factors supporting the the paraquat TK market for it to recover, however, the demand from overseas markets is still strong.

Source: Baidu

So will the paraquat market undergo new changes after 1 July, 2016 when the paraquat AS will be banned from the market? Will paraquat market still remain depressed or will the price keep falling? Or will the market be prosperous in the coming peak season after undergoing a period of output reduction in the slack season?

Most of provincial agricultural departments have made related arrangements concerning China's ban of paraquat AS. They all made it clear that all paraquat AS products will be removed from the shelves before 30 June, that they will no longer sell the remaining ones and that they plan to return or destroy them from 1 July.

In addition, other paraquat formulations that are allowed to be sold and used shall be managed as high-toxicity pesticides and sold by real-name designated units.

In H1 2016, the demand for paraquat TK from overseas market has no large growth and even weakens in some regions. Although the exports of paraquat TK and AS will not be affected by the ban of paraquat AS, foreign purchasers still continue to force down the purchase price.

What's more, as China's paraquat now mainly relies on export, the slack demand from export market keeps stopping the domestic paraquat price to rise. "Recently, Southeast Asian market, one of China's paraquat export destinations, is bearing the pressure from drought and the slow shipment of paraquat formulations forces purchasers to adopt wait-and-see attitudes.

However, since the market still remains depressed, and according to previous years, some paraquat TK manufacturers will suspend production for maintenance during slack season. Therefore, paraquat manufacturers will reduce their output in later period," revealed industry insiders.

It should be noted that the Ministry of Agriculture of the People's Republic of China (MOA) planned to re-classify paraquat as a highly poisonous substance and will no longer accept nor approve its field test and registration application; also, the MOA will no longer accept nor approve the registration renewal of paraquat except for that of TK manufacturers for export and by then paraquat will definitely exit the Chinese market and will only be able to rely on export. In response to this, domestic enterprises will reduce the output, and then the decreasing market supply may spur up the price.

In mid-June 2016, the domestic paraquat price still keeps falling sharply. According to CCM's price monitoring, the ex-works price of 42% paraquat TK was USD1,477/t in the first half of June 2016, dropped by19.20% if compared with the USD1,828/t in Jan. 2016 and by 43.50% if compared with the USD2,614/t in June 2015.

                                                   Monthly ex-works price of 42% paraquat TK in China, 2015-2016

                                                                                    Source: CCM


This article comes from Herbicides China News 1606, CCM


About CCM:

CCM is the leading market intelligence provider for China’s agriculture, chemicals, food & ingredients and life science markets. Founded in 2001, CCM offers a range of data and content solutions, from price and trade data to industry newsletters and customized market research reports. Our clients include Monsanto, DuPont, Shell, Bayer, and Syngenta. CCM is a brand of Kcomber Inc.


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Tag: herbicides  paraquat


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