Situation forecast of China’s glyphosate manufacturers

1.       Forecast and analysis of how many glyphosate enterprises and how much production capacity will participate into China’s market in 2015

China mainly expanded its production capacity in recent 2013 and 2014. And it is also in 2013 and 2014 that there are new participants in the glyphosate industry. According to the current information, no new entrants have been detected yet in China’s glyphosate industry in 2015. Therefore, it is predicted that there will be no new entrants into China’s glyphosate industry. However, there will be about new production capacity of glyphosate technical of 110,000 t/a, a result of capacity expansion by the existing glyphosate enterprises in the glyphosate industry.

2.       Forecast and analysis of how many glyphosate enterprises and how much production capacity will withdraw from China’s market in 2015

In terms of the comprehensive environmental costs in treating glyphosate waste liquid, if the Chinese government still exercises strict environmental inspection on the glyphosate industry, which not only causes unstable production capacity operation but also then leads to unsteady income, most glyphosate technical enterprises with a production capacity of less than 10,000 t/a will not improve and upgrade their environmental capability, let alone those glyphosate technical enterprises with a production capacity of less than 5,000 t/a. Therefore, there is a possibility that China’s glyphosate technical enterprises (＜10,000 t/a) will gradually withdraw from the market or be acquired by those glyphosate enterprises with stronger production capacity. It is predicted that there will be 5-10 glyphosate enterprises, totaling a production capacity of about 30,000-40,000 t/a, withdrawing from the market or being acquired by other glyphosate enterprises in 2015.

3.       Forecast and analysis of how many glyphosate enterprises and how much production capacity will be in China in 2015

Summarizing the new production capacity from the new entrants and the outgoing production capacity from the dropouts in China’s glyphosate industry in 2015, it is predicted that there will be about more than 30 glyphosate technical enterprises in China in 2015, totaling a production capacity of about 950,000 t/a-1 million t/a.

Forecast and analysis of China’s glyphosate demand

In view of the difficult increment of China’s crop planting areas, in 2015, China’s crop planting areas will be basically the same as that of the previous years, about some more 121.8 million ha (1.8 billion mu). Generally speaking, the domestic demand for glyphosate will be kept at about 60,000 tonnes.

Forecast and analysis of China’s glyphosate output

At present, China’s glyphosate production capacity is likely to keep on growing up in 2015 and the new production capacity has to get back its investment through starting production and sales. Thus the new production capacity perhaps will boost the output. Although the global planting areas for genetically modified (GM) crops in 2014 have reached 181.50 million ha, breaking the record, the annual growth rate is only 3%-4%. It is predicted that the growth rate of the global planting areas for GM crops will be still less than 5%, thus driving up the demand for glyphosate a little bit. As a whole, the global demand for glyphosate is mainly steady or slightly increased. China’s glyphosate output in 2015 is predicted to realize 550,000-600,000 tonnes.

Forecast and analysis of China’s glyphosate ex-works price

On one hand, as China’s glyphosate is mainly exported overseas, the changes of the overseas demand will significantly affect China’s glyphosate ex-works price. In 2014, China’s overseas demand was generally weak and one of reasons was probably that part of overseas traders sold the glyphosate stocked in the inventories. In 2015, the overseas traders who sold out their inventoried glyphosate are expected to propel the overseas demand for China’s glyphosate, which will actively enhance China’s glyphosate ex-works price. However, on the other hand, China’s current production capacity of glyphosate has been excessive and it is of high possibility that there will be new production capacity in 2015 and the output of 2015 will be more than that of 2014. Moreover, if overseas glyphosate manufacturers maintain regular production in 2015, it will prevent the overseas market from importing more China’s glyphosate technical. Based on the above situations, China’s glyphosate ex-works price will not rise greatly in 2015 and maybe will not reach the average price levels of 2013 and 2014 and will be very likely to encounter the similar price of 2011 or 2012. It is predicted that China’s glyphosate ex-works price in 2015 will be fluctuated between USD3,700/t (RMB23,000/t) and USD4,700/t (RMB28,000/t).

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Tag: glyphosate