Review of China’s Potash and Phosphate Markets Before the 2026 Lunar New Year

This report reviews the performance of China’s potash fertilizer, phosphate rock, and phosphate fertilizer markets in the period immediately preceding the 2026 Lunar New Year (February 5 – February 11).

As the holiday approached, the market maintained a tight balance and stable operation, laying the groundwork for post-holiday spring farming activities.

I. Phosphate Rock and Phosphate Fertilizers: Stable Pre-Holiday Operations, Supply Contraction Providing Support

Ahead of the Lunar New Year, China’s phosphate rock market remained broadly stable. Prices in major northern and southern production regions showed no changes. Producers focused on shipping existing orders, while downstream buyers mainly arranged cargo returns and replenished inventories on a demand-driven basis. No concentrated procurement activity emerged, and trading conditions remained steady before the holiday.

On the supply side, clear pre-holiday characteristics were observed:

• Most mines in Hubei entered their traditional suspension period.

  
  

• Southwestern regions focused primarily on shipments.

  
  

• Northern regions experienced supply contraction due to environmental inspections.

  
  

As a result, overall domestic phosphate rock supply declined.

On the demand side, downstream phosphate fertilizer producers maintained stable operating rates, focusing on winter stockpiling fertilizers and preparations for spring farming. Supported by demand from purified phosphoric acid producers, phosphate concentrate prices remained firm.

In the phosphate fertilizer market, transactions gradually slowed before the holiday, with enterprises mainly executing previously scheduled shipments. Supported by high raw material costs, prices remained firm:

• Mainstream prices for 55% powder MAP in Hubei held steady at RMB 3,800–3,850/ton.

  
  

• The mainstream reference price for 73% industrial-grade MAP remained stable at around RMB 6,500/ton, with only slight price loosening by a few enterprises.

  
  

The international phosphate fertilizer market showed relative strength:

• Demand in South America gradually recovered, pushing prices upward. Chinese companies have begun export negotiations for NP binary fertilizers.

  
  

• The Indian subcontinent remained in a seasonal demand lull, with stable prices and subdued demand.

  
  

Globally, phosphate fertilizer purchasing remained largely driven by rigid demand. Elevated raw material costs continued to support firm pricing.

Exports of other phosphate fertilizers faced restrictions:

• Binary compound fertilizers were temporarily suspended from export customs clearance.

  
  

• Inspection procedures for SSP and TSP were extended, affecting export circulation rhythms.

  
  

Overall, before the holiday, phosphate rock prices remained elevated due to supply contraction and rigid demand support. In the short term, the market is expected to remain firm. Attention should be paid to post-holiday inventory levels in Sichuan and potential transportation disruptions related to the 2026 Three Gorges Dam maintenance, which could influence pricing.

II. China’s Potash Market: High-Level Consolidation Before the Holiday, Silent Tight-Balance Standoff

Ahead of the Lunar New Year, China’s potash market did not exhibit seasonal loosening. Instead, it maintained high-level consolidation with subdued transactions, characterized by a balance between “strong current fundamentals and weaker expectations,” entering a pre-holiday silent operating window.

1. Potassium Chloride: High-Level Sideways Movement with Clear Regional Price Differentiation

Before the holiday, China’s potassium chloride market maintained high-level fluctuation. Prices for domestic potash, border trade potash, and imported port potash remained stable without significant adjustments.

Regional differentiation was evident. Prices in Northeast China were higher than in other regions, with regional spreads driven by logistics costs, supply-demand structures, trader sentiment, and circulation restrictions.

2. Market Atmosphere: Reduced Activity, “Prices Without Volume”

As the holiday approached, the market gradually entered a vacation mode. Inquiry frequency declined significantly, and transaction pace slowed.

Traders held limited sellable inventories. Against a backdrop of high prices, most preferred to hold goods rather than offer discounts. The market therefore exhibited a “price without volume” phenomenon — quotations remained stable, but actual transaction activity was weak. Prices increasingly reflected psychological anchoring rather than transaction-driven movement.

Although imported potash cargoes continued to arrive before the holiday, slower shipment rhythms led to a gradual increase in port inventories. According to industry monitoring, by the end of January, domestic potassium chloride port inventories reached approximately 2.49 million tons, down 12.15% year-on-year.

It is important to note that the increase in inventory did not alter the tight-balance structure. The proportion of freely tradable cargo remains limited, as most volumes are pre-allocated or locked into downstream contracts. Actual circulating resources remain tight. This aligns with the National Development and Reform Commission’s recent emphasis on ensuring fertilizer supply for spring farming, with backbone enterprises stabilizing supply via direct channels.

3. Demand Structure: Agricultural Demand Weakens, Industrial Demand Provides Support

Before the holiday, potash demand showed structural adjustment:

• Downstream compound fertilizer producers scheduled maintenance or reduced operating rates, weakening agricultural demand.

• Meanwhile, rigid demand from industries such as glass and ceramics persisted, providing bottom support and preventing sharp price declines.

4. Potassium Sulfate: Cost Pressure, Limited New Transactions

Compared with potassium chloride, the potassium sulfate market remained generally stable but under pressure.

Quotations in various regions maintained previous levels, with no active price adjustments. New transactions were limited, and enterprises focused on executing existing orders.

On the supply side:

• Operating rates remained low.

• Some producers maintained reduced loads due to insufficient orders or raw material constraints.

• Elevated raw material costs encouraged conservative production strategies, limiting short-term capacity increases.

Price-wise, most manufacturers quoted over RMB 4,000/ton for 52% powder SOP, though few transactions reached this level. Traders who stocked at lower prices previously now offer goods around RMB 3,900–3,950/ton.

Raw materials account for over 60% of SOP production costs. Volatile input costs have reduced production willingness, with some producers facing a situation where increased production results in greater losses.

5. Overall Pre-Holiday Potash Market Pattern: Tight Balance Unchanged

Overall, China’s potash market maintained a tight supply-demand balance before the holiday.

Although traders’ available inventories were limited, the urgency of procurement declined as the holiday approached and backbone enterprises continued releasing volumes downstream. This explains why potash prices remained stable rather than rising further.

In the short term, absent structural changes in supply and demand, potash prices are expected to remain at high-level consolidation. Post-holiday trends will depend mainly on the pace of agricultural demand recovery and the stability of industrial demand.

III. Review of the 2025 Potash Market: Foundation for 2026

In 2025, China’s potash market demonstrated strong performance, characterized by:

• Stable but slightly declining production

• High-level price volatility

• Optimized import structure

• Significant profit growth for enterprises

On the fundamentals side:

• Domestic potassium chloride output was estimated at 5.3 million tons, down 3.64% year-on-year.

• Zangge Mining reduced capacity from 2 million tons to 1.2 million tons, implementing a “resource conservation” strategy.

• Annual potassium chloride imports reached approximately 12.61 million tons, with external dependence exceeding 70%.

• While total imports were roughly flat year-on-year, the structure improved significantly. Laos rose to become the third-largest import source, with 2.2637 million tons imported in 2025, nearly 18 times higher than five years earlier.

Price Performance in 2025

Potash prices experienced two rounds of “sharp rise followed by correction,” with an overall pattern of “lower at the beginning, higher at the end, and upward volatility.”

• Early-year port price for 62% white potash: RMB 2,550–2,600/ton

• July peak: RMB 3,350–3,680/ton

• Year-end mainstream price: RMB 3,150–3,500/ton

The annual price spread reached RMB 600–900/ton, representing a 23.5%–34.6% year-on-year increase (based on Lianyungang 62% white potash mainstream market prices).

Price gains were driven by production cuts in major overseas producers, rising costs among international giants, and low domestic port inventories.

Strategic Developments

Chinese enterprises accelerated overseas potash resource development, particularly in Laos. Large-scale projects by Zangge Mining, Asia-Potash International, and Dongfang Tower gradually came online. The China–Laos Railway shortened transportation cycles, enhancing China’s self-sufficiency capacity.

IV. International Market Review: Phosphate Strength, Global Fertilizers at Elevated Levels

Before the Lunar New Year, the international phosphate fertilizer market remained bullish.

Key drivers included:

• Expectations of reduced Chinese phosphate exports in the first half of 2026

• Elevated raw material costs

• Early procurement by importers in the United States, Brazil, and Argentina

Structural supply shortages, trade disruptions, and rising logistics costs continued to support global fertilizer prices.

Although products from Russia and Iran continued entering the global market, increased supply chain complexity diminished their price-smoothing effect. Global fertilizer prices are expected to remain elevated throughout 2026.

V. Overall Conclusion

During February 5–11, 2026, China’s potash and phosphate markets displayed three defining characteristics: stability, tightness, and strength.

• Phosphate rock and phosphate fertilizer prices remained stable, supported by supply contraction and rigid demand, with strong bullish sentiment internationally.

• The potash market consolidated at high levels, with subdued transactions and clear regional differentiation. Agricultural demand weakened seasonally, but industrial demand provided support. The tight balance structure remained unchanged.

• Internationally, phosphate fertilizers remained bullish, and global fertilizer prices stayed elevated under multiple supporting factors, indirectly reinforcing China’s domestic market.

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.