China Liquid Ammonia Slumps 13% in a Week as Restarts Flood the Market and Fertilizer Demand Fades

Chinese liquid ammonia posted the largest weekly decline on the domestic fertilizer board. 100ppi's week-41 (12-16 October) fertilizer price monitor shows liquid ammonia falling to CNY 2,616.67 a tonne from CNY 3,006.67, a weekly drop of 12.97% and the worst of six decliners in a basket where nothing rose and two products were flat, leaving the weekly average change at -2.78%. The daily board for 16 October showed the same direction, with the benchmark sliding 4.27% on the day from CNY 2,733.33. SCI99's morning note put the national average at CNY 2,677 a tonne as of 14 October, down CNY 58 on the day, with regional quotes ranging from CNY 2,270-2,350 in Hubei to CNY 3,150-3,200 in Fujian. Prices remain 18.40% higher year on year.

Supply is the dominant driver. Units that had been shut for maintenance have restarted in succession and new capacity has been released in an orderly way, so market supply has risen steadily and the earlier tightness has eased markedly. Producers have stepped up selling and some inventories are building, and quoted prices have fallen for several consecutive sessions: on 15 October Hebei Zhengyuan cut CNY 200 to CNY 2,670, Shandong Shuntian cut CNY 150 to CNY 2,650, and Shandong Hualu-Hengsheng cut CNY 200 to CNY 2,880 on acceptance terms, with its 600,000 t/yr unit running normally and around 900 tonnes a day sold externally. SCI99's sentiment survey found 70% of participants expecting the market to hold broadly stable and 30% expecting further softening of about CNY 50 a tonne.

Demand has not absorbed the extra volume. Phosphate and compound-fertilizer operating loads are low, compound-fertilizer run rates are around 32%, and only steady chemical offtake is being covered as buyers work down stocks bought earlier. The autumn fertilizer season is winding down while winter storage buying has not yet started, so nitrogen offtake is seasonally at its weakest. Cost support is also eroding: Shanxi Jincheng washed anthracite smalls (S0.4-0.5) were quoted at CNY 1,400-1,480 a tonne including tax, broadly flat on the previous session, leaving producers with a weaker floor under prices. Across the rest of the nitrogen and phosphate chain, urea fell 1.71% to CNY 1,727.50, imported potassium chloride fell 2.51% and ammonium sulphate fell 3.63% over the same week.

The weakness is specific to nitrogen rather than to farm-input economics as a whole. Capital is still being committed elsewhere in the fertilizer complex on far firmer long-run decks: on 16 October Buffalo Potash won Saskatchewan approval to finish building and operate the 125,000 t/yr initial module of its Disley solution mine about 50 km northwest of Regina, with first production targeted for early 2027 and two further 500,000 t/yr modules designed to lift combined capacity to about 1.13m t/yr. Its April preliminary economic assessment assumed $374 a tonne for soluble-grade potash and $394 for granular product over a 25-year evaluation. Chinese nitrogen, by contrast, is being set in a spot market where producers are discounting to clear restarted volume into a seasonal demand trough.

The Chinese slump has not yet reached US farm-gate nitrogen. FertilizerPrice.com, updated 18 October, shows anhydrous ammonia at $905.50 a short ton, essentially unchanged week on week at -$0.16, while urea jumped $134.75 or 18.5% to $864.75 and MAP rose 10.6% to $1,128.01. That divergence matters because China has become a marginal exporter: an unprecedented wave of mainland Chinese ammonia supply has been covering Indian spot demand and helping set wider regional and global values, with shipments up roughly 78% month on month at one point this year. If Chinese producers keep discounting into export markets, the pressure on Tampa and Black Sea ammonia benchmarks builds even while US domestic quotes hold flat.