Early November 2025 China Fertilizer Market: Potash Leads the Rise as Raw Material Costs Surge and Demand Weakens

In November 2025, China’s fertilizer market exhibited a clear trend driven by raw materials. Supported by increasingly tight supply, the potash fertilizer market continued its upward movement, forming a “high in the north, low in the south” price pattern.

Meanwhile, sharp increases in the prices of sulfur, sulfuric acid, and other raw materials pushed phosphate compound fertilizer production costs sharply higher, triggering an upward adjustment in industry guideline prices. However, downstream demand has already entered a seasonal off-season, reducing acceptance of high-price products. As a result, the market is trapped in a deep tug-of-war between cost-driven price increases and demand-side resistance.

I. Potash Fertilizer Market: Tight Supply Drives Increases, Regional Differences Expand

At the beginning of the month, China’s potash market continued its strong upward trajectory. Tight supply remained the dominant theme, as both MOP (muriate of potash) and SOP (sulfate of potash) prices increased, further widening regional price gaps.

1. MOP: Supply Concentration Lifts Prices, Northern Market Leads the Rise

The MOP market is characterized by large traders dominating supply and limited circulation volume. Border trade arrivals are largely concentrated in the hands of a few major traders, leaving very limited resources available for sale. Quotations remain high, and most transactions are negotiated on a case-by-case basis with very little room for bargaining.

Northern suppliers show particularly strong reluctance to sell, supporting sustained high quotations. Although some cargoes are arriving at ports, these too are concentrated among large traders, resulting in tight spot availability.

On the import side, support continues to strengthen. Recent MOP arrivals are limited, leading to gradually declining port inventories. In Northeast China—where demand from grain-producing regions is strong—large-granular MOP has become especially favored by farmers. A surge in inquiries has driven price increases significantly higher than those for other product categories.

Border trade and China-Europe Railway cargoes are gradually arriving, offering some supply replenishment. However, much of the early arrivals entered inventory rather than circulation, meaning spot availability has not significantly improved. Combined with tight global supply and lengthened domestic arrival cycles, upward pressure remains strong.

2. Sulfate of Potash (SOP): Dual Cost Squeeze Fuels Broad-Based Increases

The SOP market saw widespread price increases driven by soaring raw material costs. Mannheim-process producers are under dual cost pressure from rising MOP prices and surging sulfuric acid. With sharply elevated production costs, factory quotations continued climbing. Although regional gaps exist, the overall increase exceeded 10% nationwide.

Resource-based SOP producers maintained stable output but raised quotations alongside the broader market trend. Most transactions remain negotiated individually. Upstream cost pressure continues to elevate fertilizer application costs for end users.

3. Market Pattern: “High North, Low South” Solidifies as Demand Weakens

China’s potash market has clearly formed a “high in the north, low in the south” pattern:

• North China: Winter storage demand + limited supply = strong price-support mentality

• South China: Stable arrivals = slower increases, but still following the broader upward trend

High prices are now significantly suppressing downstream purchasing. New transaction volumes are slowing, with most buyers making only small, rigid-demand purchases. Acceptance of high prices continues to decline, showing clear signs of insufficient demand follow-through.

II. Raw Material Market: Sulfur Leads the Rally as Multiple Products Surge

In November, sulfur led the raw materials rally, followed by increases in sulfuric acid, while phosphate rock prices showed regional divergence. Supply tightening combined with rising demand pushed most raw materials upward, providing strong cost support for fertilizers.

1. Sulfur: Tight Supply Persists, Prices Hold at High Levels

China’s port sulfur inventory remained around 2.25 million tons, largely unchanged week-on-week. However, November arrivals were lower than expected, and port destocking continued. Traders showed strong reluctance to sell, resulting in prices consolidating at high levels.

Globally, supply tightness is unlikely to ease in the short term. Reduced refinery output in major exporting countries such as Russia and Qatar—plus temporary export restrictions on certain products—kept global supply constrained. Meanwhile, domestic demand continues to rise as new downstream capacity comes online. Although the recent rapid price spike has led to some consolidation and more cautious downstream purchasing, the fundamental tight-supply logic remains intact.

2. Sulfuric Acid: Cost + Supply Pressure Push Prices Higher

Sulfuric acid prices continued rising this week, increasing by 20–60 RMB/ton nationwide.

• In Hubei and Shandong, rising sulfur prices directly pushed production costs higher.

  
  

• Most sulfuric acid producers maintained low inventories, further tightening supply.

  
  

• North China prices rose 20–40 RMB/ton, while Southwest and South China increased 30–40 RMB/ton.

  
  

With both cost support and tight supply, sulfuric acid still has upward potential, with regional differences depending on local supply–demand conditions and transport constraints.

3. Phosphate Rock & Synthetic Ammonia: Divergent Trends With Localized Strength

Phosphate rock markets showed a “south–north split”:

• Southwest China (Guizhou, Sichuan): Strong reluctance to sell + limited shipments = firm prices

  
  

• Hubei: Some mines entering early maintenance due to exhausted mining quotas = reduced supply

  
  

• North China (Hebei Chengde): Downstream factory shutdowns weakened demand and pushed prices down 20 RMB/ton

  
  

• Yunnan: Flood-season disruptions tightened yellow phosphorus ore supply

  
  

Synthetic ammonia prices rebounded gradually due to improving downstream demand from phosphates and urea. While low-end prices have some room to rise further, resistance to high prices remains strong. In the short term, ammonia prices are expected to remain firm, with regional differences driven by transport radius limitations.

III. Phosphate Compound Fertilizer Market: Higher Costs Push Guideline Prices Up, Off-Season Demand Limits Transactions

The surge in sulfur and sulfuric acid caused phosphate compound fertilizer production costs to rise sharply. Industry guideline prices increased 200–300 RMB/ton this week. However, actual transaction prices did not fully follow, as downstream demand remains in a seasonal lull. Spring ploughing procurement is still months away, and most dealers remain cautious about buying at high prices.

To reduce cost pressure, some producers are adjusting production parameters—such as using lower-grade phosphate rock or switching sulfuric acid suppliers. For producers who rely entirely on purchased raw materials (especially DAP producers), costs are now approaching selling-price levels, significantly narrowing profit margins across the industry.

IV. Market Outlook: High-Level Standoff Continues—Watch Three Key Variables

In the short term, the fertilizer market will continue its high-level standoff.

• Potash prices are likely to remain firm due to limited border-trade arrivals and tight import supply.

  
  

• Rising SOP production costs will continue to support higher quotations.

  
  

• Global supply tightness in sulfur and sulfuric acid makes price declines unlikely, supporting production costs.

  
  

However, attention must be paid to demand suppression from high prices. With downstream markets in an off-season and acceptance of high prices falling, weakened buying interest may cap further increases.

Three key variables will determine the next market trend:

1. Future potash arrivals via border trade and China–Europe Railway and whether port inventories can be replenished.

   
   

2. International price volatility of sulfur and MOP and its transmission to the domestic market.

   
   

3. Timing and intensity of winter storage and spring-ploughing fertilizer procurement, which will be crucial in breaking the current stalemate.

   
   

Attention: The above information is for commercial reference only due to the diversity of information collected, and Kelewell is not responsible for the authenticity of the data.