The Phosphate Chemical – An Integrated Value Chain

1. Industry Overview

The phosphate chemical industry is a crucial sector within the chemical industry, producing materials such as phosphoric acid, phosphate fertilizers, pesticides, and phosphate salts. These products find widespread applications in agriculture, food processing, detergents, and electronics. Currently, the industry is undergoing a transformation, expanding from its traditional base in fertilizers toward new energy materials. This shift is driven by the continued growth of the global new energy sector and the increasing market share of electric vehicles, which has led to a surge in demand for lithium iron phosphate and other battery-related materials, significantly boosting the development of the phosphate chemical industry.

Phosphate chemicals represent a key subdivision of the broader chemical sector. Using phosphate rock as its primary raw material, the industry processes phosphorus into a wide range of phosphate-based chemical products through various chemical methods. These products play essential roles in national economies and strategic security, with wide applications in agriculture, industrial manufacturing, pharmaceuticals, coatings, and flame retardants.

Phosphate chemical products fall broadly into two categories:

• Agricultural Use: Primarily represented by fertilizers such as Monoammonium Phosphate (MAP), Diammonium Phosphate (DAP), and Dicalcium Phosphate, as well as phosphorus-containing pesticides like glyphosate.

• Industrial, Food, and Pharmaceutical Use: Includes phosphoric acid and various phosphate salts such as sodium tripolyphosphate, dicalcium phosphate, and sodium hexametaphosphate.

2. Key Products in the Phosphate Chemical Industry

Product	Applications	Production Method
Phosphoric Acid	Industrial grade: phosphate salt production, metal treatment, desiccants; Food grade: acidulants, yeast nutrients; Electronic grade: wafer cleaning and etching; Lower purity: LCD component cleaning	Reacting phosphate rock with sulfuric acid
MAP & DAP	Highly water-soluble and fast-acting phosphate fertilizers for rice, wheat, corn, cotton, fruits, and vegetables	Reacting phosphoric acid with ammonia
Triple Superphosphate (TSP)	High-concentration, water-soluble phosphate fertilizer; also used in compound fertilizer production	Reacting phosphate rock with phosphoric acid
Sodium Tripolyphosphate	Detergents, water softeners, leather tanning, dyeing aids, catalysts, pharmaceutical dispersants, food additives	Produced from sodium carbonate and phosphoric acid; commonly known as "STPP"
Sodium Hexametaphosphate	Food grade: water retention and preservation; Industrial grade: water softeners, dispersants, corrosion inhibitors, adhesives, boiler cleaners	Produced from sodium carbonate and phosphoric acid; also called "SHMP"
Dicalcium Phosphate	Available in feed, food, toothpaste, and pharmaceutical grades; used in medicine, dentistry, plastic stabilizers, food additives, and fertilizers	Produced from phosphoric acid and lime milk
Organophosphates	Includes phosphite esters, phosphate esters, phosphonate esters, chlorinated phosphates, thiophosphates; used in pesticides, water treatment, surfactants, and textile auxiliaries	Produced by reacting phosphorus intermediates with alcohols or phenols

3. Full-Chain Structure of the Phosphate Chemical Industry

The upstream sector includes raw materials (sulfuric acid, nitric acid, hydrochloric acid, phosphate rock, silica), energy (coke, electricity), and equipment (sandblasters, degreasers, acid-washing machinery). The midstream sector involves the production of key intermediates like yellow phosphorus and phosphoric acid. The downstream sector encompasses applications across agriculture and industry—including feed additives, pesticides, lithium batteries, flame retardants, detergents, water treatment, pharmaceuticals, construction, and plasticizers.

Two Key Production Routes:

1. Wet-Process: Phosphoric acid is directly produced from phosphate rock using acids (e.g., sulfuric acid), then further processed into various products.

   
   

2. Thermal-Process: Phosphate rock is first processed into yellow phosphorus, then oxidized into phosphoric acid. Yellow phosphorus is also used to produce phosphorus trichloride—a vital intermediate in glyphosate manufacturing.

In fertilizer production, wet-process phosphoric acid is the key midstream intermediate, whereas in industrial phosphate salt production, thermal-process yellow phosphorus is more common.

4. Phosphoric Acid Production Processes

4.1 Thermal-Process Phosphoric Acid

• Involves smelting phosphate rock with coke and silica at high temperatures to produce yellow phosphorus.

• Yellow phosphorus is then oxidized and hydrated to yield phosphoric acid.

• Divided into single-step and two-step methods depending on whether oxidation and hydration occur in the same tower.

• Characterized by low industry concentration and higher costs; development is constrained by environmental regulations.

4.2 Wet-Process Phosphoric Acid

• Produced by decomposing phosphate rock with sulfuric acid.

• Based on the crystalline form of calcium sulfate (gypsum) in the slurry, wet-process can be subdivided into:

  • Dihydrate (CaSO₄·2H₂O)

  • Hemihydrate (CaSO₄·½H₂O)

  • Anhydrous

  • Hybrid processes (e.g., hemihydrate-dihydrate)

• Currently, dihydrate process dominates with 85% adoption.

• The hemihydrate and hybrid processes—which can produce high-concentration phosphoric acid (P₂O₅ ≥ 40%)—account for only 15%.

5. Phosphate Rock Resources

Phosphate rock is a non-renewable, strategic mineral resource with uneven global distribution.

• Global reserves (2023, USGS): ~74 billion tons

  • Morocco: 50 billion tons (67.6% of global total)

• China's share:

  • Reserves: 3.8 billion tons (2nd largest globally, 5.1%)

  • Output: 90 million tons in 2023 (40.9% of global production), indicating fast resource depletion

Phosphate rock grades (P₂O₅ content) vary from 5–40%, with most countries averaging around 30%, and some deposits reaching 39%.

More than 70% of mined phosphate rock in China is used for fertilizer production (MAP, DAP, TSP), with the remainder processed into yellow phosphorus and phosphate salts for feed, pesticides, detergents, food additives, daily chemicals, and batteries.

6. Industry Trends and Market Outlook

6.1 Trade Landscape

• With Morocco and Saudi Arabia ramping up production, China faces increased export competition.

• China’s phosphate fertilizer export share is expected to decline from 30% to 25% by 2030.

• Southeast Asia’s share of Chinese phosphate exports is projected to grow from 41% (2023) to 53% by 2030 due to rising demand in emerging markets like India.

6.2 Growing Demand

• Phosphate fertilizer demand is expected to grow at an average rate of 3.5% annually, reaching over USD 90 billion by 2030 due to population growth and food security needs.

• Lithium iron phosphate (LFP) demand is forecast to exceed 3 million tons by 2028, with a compound annual growth rate (CAGR) of 25%.

6.3 Product Upgrading

• Fine phosphate products—such as electronic-grade phosphoric acid and food-grade phosphates—are experiencing rapid growth.

• Between 2025–2030, global output of high-end phosphate products is expected to grow at a CAGR of 12.5%, with a market size exceeding USD 28 billion by 2029.

7. Major Product Segments

7.1 Phosphate Fertilizers

Phosphate fertilizers are chemical products that supply phosphorus to crops. They can be classified by nutrient content (single, binary, or NPK compound) and by solubility (water-soluble, citrate-soluble, or insoluble).

• Common types: MAP, DAP, TSP, SSP

• Typically applied as a MAP-DAP blend in agricultural production

Find more details about MAP vs. DAP on below link:

https://www.kelewell.de/en/post/tmap-vs-tdap-chemistry-application-and-global-trends

Guide to DAP:

https://www.kelewell.de/en/post/a-procurement-guide-to-dap-18-46-0-key-insights-on-market-trends-sourcing-strategies-and-cost-opt

China Overview of MAP:

https://www.kelewell.de/en/post/2024-china-monoammonium-phosphate-map-market-overview

China's production data:

• 2023 total output: 16.15 million tons (+6.1% YoY)

• 2024 estimate: 16.16 million tons

• High-concentration fertilizers: 96.64% of total output

  • MAP: 7.33 Mt (45.4%)

  • DAP: 6.62 Mt (41%)

  • NPK: 1.25 Mt (7.7%)

  • TSP: 0.36 Mt (2.2%)

  • NP: 0.05 Mt (0.3%)

China is the world’s largest phosphate fertilizer producer, with MAP and DAP output accounting for two-thirds of global production. Supply-side reforms and environmental inspections have significantly reduced overcapacity, improving utilization rates.

7.2 Glyphosate

Glyphosate is a phosphorus-based herbicide and the most widely used globally. It is highly effective against perennial weeds and commonly paired with genetically modified glyphosate-resistant crops.

• Mode of action: Inhibits EPSPS enzyme, disrupting nitrogen metabolism

• GM crops: Engineered to express higher levels of EPSPS, enabling weed control without harming crops

Market data:

• 2022 global capacity: ~1.18 million tons

  • Monsanto (US): ~370,000 tons/year

  • China: over 80% of global exports

• 2023 China capacity: 810,000 tons; production: 530,000 tons

• 2024 estimate: 580,000 tons

Regional trends:

• North America: Largest consumer

• Europe: Tightly regulated, yet widely used

• Asia: Demand surging in China and India due to agricultural expansion

7.3 Lithium Iron Phosphate (LFP)

LFP (LiFePO₄) is a widely used cathode material in lithium-ion batteries, especially in energy storage systems and electric vehicles.

• China’s 2023 lithium battery output: 887.4 GWh (+34.3% YoY)

• 2024 forecast: 1175 GWh (+32.6%), 78.6% of global share

With the growing popularity of EVs, demand for LFP is booming. Iron phosphate (a precursor to LFP) is also experiencing robust expansion. Key industry players include phosphate chemical firms, titanium dioxide manufacturers, and battery material suppliers.

8. Conclusion

The phosphate chemical industry has a strong outlook supported by expanding applications in fertilizers, phosphates, and new energy materials. In agriculture, phosphate fertilizers remain irreplaceable. While consumption fluctuates slightly, long-term demand is stable. In energy, the rise of LFP batteries—driven by electric vehicle adoption—is fueling robust growth across the phosphate supply chain.

Phosphate chemical enterprises that integrate upstream mineral resources and downstream value-added processing will be well-positioned to capitalize on future market opportunities.

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.