Review of China's Phosphate Fertilizer Industry in 2010 and Its Outlook in 2011   

By Qi Yan,  China Sulfuric Acid Industry Association

1  Review of China's phosphate fertilizer industry in 2010

1) Production of new-type phosphate fertilizers continued to grow rapidly

In 2010, China's phosphate fertilizer output was 15.82 million tons (100% P2O5, the hereinafter the same), up 14.2% year on year. The output of high-concentration phosphate & compound fertilizers was 13.02 million tons, accounting for 82.3% of the total phosphate fertilizer output, up 19.1% year on year; including: 5.37 million tons of diammonium phosphate (DAP), and 5.26 million tons of monoammonium phosphate (MAP). The output of phosphoric acid-based compound fertilizer was 1.55 million tons, accounting for 9.8% of the total. The output of triple superphosphate (TSP) and nitrophosphate fertilizer was 780 000 tons and 55 000 tons, respectively, both accounting for 5.2% of the total. The output of low-concentration phosphate fertilizer was 2.8 million tons, down 4.1% year on year, including 2.55 million tons of single superphosphate (SSP), and 250 000 tons of fused calcium magnesium phosphate (FCMP). Various varieties of phosphate and compound fertilizers had more reasonable proportion in the total output.
   In 2010, the physical output of DAP was 11.71 million tons, up 12% year on year. Mainly driven by exports, most of DAP plants were operated at full capacity. Meanwhile, new DAP units with a combined capacity of 1.8 million t/a at Guizhou Kailin Group (Kailin), Yunnan Yuntianhua Group (Yuntianhua) and Hubei Sanning Chemical Co Ltd were also put into production. In 2010, the physical output of MAP was 11.34 million tons, up 25.1% year on year, with an increase greater than previous years, because the output of more MAP producers was added into the statistics and some new MAP units were put into operation. The combined physical output of 60 major phosphate & compound fertilizer producers was 32.49 million tons, up 8.6% year on year, including 9.17 million tons of phosphoric acid-based compound fertilizer (up 11.4%), 8.91 million tons of sulfur-based compound fertilizer, 1.7 million tons of TSP (up 28.9%) and 470 000 tons of nitro-phosphate fertilizer (down 28.8%).
   During 2006-2010, new-type fertilizers also were developed rapidly in China. A variety of slow-release fertilizers, special fertilizers for various crops, seaweed fertilizer, microbial fertilizer and water-soluble fertilizers for water-saving agriculture have been put into  industrialized production. At present, the production capacity of slow-release fertilizer in China is nearly 2.5 million t/a, and its output is about 700 000 tons, including 50 000 tons of coated fertilizer, 50 000 tons of resin-coated fertilizer, 300 000 tons of sulfur-coated fertilizer, 200 000 tons of biochemical inhibitors, and 100 000 tons of urea formaldehyde fertilizer.

2) Production of basic phosphate fertilizer continued to be concentrated in phosphorite-rich areas

In 2010, the combined phosphate fertilizer output of Hubei, Yunnan, Guizhou, Sichuan and Chongqing provinces, which have abundant phosphorus resources, accounted for 71.4% of the national total phosphate fertilizer output. Hubei province was the largest producer of phosphate fertilizer in China, having an output of 3.94 million tons, followed by Yunnan and Guizhou, having an output of 3.61 million tons and 2.06 million tons, respectively. Shandong, Anhui and Jiangsu provinces had a phosphate fertilizer output of 920 000 tons, 820 000 tons and 550 000 tons, respectively, and their total output accounted for 14.5% of the national total. The total phosphate fertilizer output of other provinces accounted for only 14.1% of the national total. Especially, the production of DAP and MAP was mainly concentrated in phosphorite-rich areas, such as Yunnan, Guizhou, Hubei and Chongqing. The combined DAP output of the four provinces accounted for 79.4% of the national total DAP output; and the combined MAP output of Hubei, Yunnan, Guizhou, Chongqing and Sichuan accounted for 80.3% of the national total MAP output. But the production of compound fertilizer (NPK) was concentrated in major crop production areas, such as Shandong, Hubei, Anhui and Jiangsu provinces.
   The industrial concentration level of China’s phosphate fertilizer industry has gradually improved. In 2010, there were a total of 420 phosphate fertilizer producers in the country, and the top 10 ones accounted for 46% of the national total phosphate fertilizer output. Among these producers, 18 ones had an annual output of more than 200 000 tons each. The number was about 4.3% of the total number of producers, but their combined output accounted for 60% of the national total. 333 producers had an output of less than 20 000 tons each. Their number was 79.2% of the total number of producers, but their combined output accounted for only 14% of the national total. They mainly produced low-concentration phosphate fertilizer. 57 producers, about 16% of the total number of producers, had an output of 20 000 to 100 000 tons each. Among phosphate fertilizer products, DAP production has the highest concentration level. There are 25 DAP producers in China. In 2010, the top 10 ones accounted for 80% of the national total DAP output. Yuntianhua is the largest DAP producer in China, having a DAP output of 1.37 million tons (pure content, the hereinafter the same) in 2010, followed by Kailin (750 000 tons) and Guizhou Wengfu Group (557 000 tons). 14 producers each with a DAP output of more than 100 000 tons accounted for 92.7% of the national total. So, it can be said that DAP has basically realized large-scale production. MAP has a relatively low industrial concentration level. In 2010, among 59 MAP producers in China, the top 10 ones accounted for 60% of the national total MAP output. Hubei Newyangfeng Fertilizer Co Ltd (Newyangfeng) is the largest MAP producer in China, having a MAP output of 600 000 tons in 2010, followed by Yuntianhua (439 000 tons) and Sinochem Fuling Chemical Co Ltd (296 000 tons). 16 producers each with a MAP output of more than 100 000 tons accounted for 75.8% of the national total MAP output. NPK compound fertilizer is mainly produced by secondary processing enterprises. The top 10 producers accounted for 48% of the national total NPK fertilizer output.
   From 2005-2010, the proportion that the top 10 phosphate fertilizer producers account for in the national total phosphate fertilizer output climbed from 35% to 46%. In 2010, the top 10 phosphate fertilizer producers in China were Yuntianhua, Kailin, Wengfu, Newyangfeng, Hubei Yihua Group, Anhui Tongling Chemical Industry Corp (Tongling Chemical), Sinochem Fuling, Jiangsu Luling Chemical Group, Shandong Lubei Enterprise Group (Lubei Group) and Guangdong Zhanjiang Chemical Co Ltd.

3) Exports grew

In 2010, supported by China's phosphate fertilizer import & export tariff policy, Chinese phosphate fertilizer producers actively sought international markets to release their excess production capacity. In this year, China imported 421 000 tons of phosphate & compound fertilizers (down 1.2% year on year) and exported 3.08 million tons (up 77.4% year on year), so this country's net export volume of phosphate & compound fertilizers reached 2.66 million tons, up 103% from 2009.

4) Fertilizer consumption became stable

According to the statistics yearbook and farmer survey data, Dr. Zhang Weifeng from China Agricultural University calculated the apparent consumption of various N, P and K fertilizers in China. His studies show that the consumption of phosphate fertilizer in China has stayed steadily at 11 million tons for three consecutive years. This shows that the consumption of phosphate fertiliz