In mid-February, China’s main glyphosate TC producers raised their prices by amounts ranging from USD72.20 (RMB 500) per ton to USD 101.08 (RMB 700) per ton. Manufacturers in central China moderately reduced their operating rates after the Chinese New Year holiday, while suppliers in the west increased prices due to significantly restricted transportation in many areas. The short-term price of glyphosate TC is expected to continue to grow, although demand remains low.
In mid-February, the average ex-works price of China’s glyphosate TC was around USD (RMB 21,000) per ton, with offers from major buyers increasing by amounts from USD72.20 (RMB 500) per ton to USD 101.08 (RMB 700) per ton. Demand remained stable and low both within China and abroad, but prices showed an upward tendency when many businesses opted to postpone their resumption of work after the Chinese New Year holiday due to the COVID-19 outbreak. In addition, nationwide road blocks put into effect in order to control the outbreak have further contributed to price increases. Producers in central China moderately reduced their operating rates after the festival, while suppliers in the west raised their prices due to many major roads in western China being closed.
Glyphosate producers and suppliers wait patiently, hesitate to do business
A large amount of glyphosate inventory remains on the market, with main producers continuing to create supply. Glyphosate TC price will likely remain stable and grow mildly, as both suppliers and purchasers are currently showing cautious and hesitant attitudes, with concern over subsequent epidemic situations. It is expected that suppliers will continue to raise prices if transportation becomes more difficult in order to maintain profits, and it is expected that many purchasers may wait to see if transportation logistics become easier before buying.
While the coronavirus outbreak has pushed up the price of glyphosate TC, it remains unclear what effect this will have on the pesticide industry. For now, the production and price are directly affected by raw materials and transport factors. The impact of the coronavirus on the glyphosate market will be more obvious in the coming peak season.
Glyphosate soars in Chinese market, but receives tepid global reception
In the Shenzhen stock market, the prices of stocks related to glyphosate soared in mid-February, likely as a response to the recent increases in price. Similarly, the market sector for agricultural chemicals and veterinary medicines showed strong performance overall. In particular, stocks in Shenzhen Noposion Agrochemicals Co., Ltd., Jiangsu Huifeng Joint-Stock Co. Ltd., Zhejiang Qianjiang Biochemical Co. Ltd., and Sino-Agri Leading Joint-Stock Co. Ltd. showed dramatic increases in prices. However, in the global market, glyphosate is gradually becoming less popular. In January, the government of Bangladesh formed an action plan to stop the use of glyphosate as an agricultural herbicide in favor of more environmentally-friendly alternatives. Furthermore, most European countries show the same hesitation to use glyphosate, and use of the herbicide in Europe is heavily regulated. Many countries have found the herbicide glufosinate ammonium to be a safer alternative to glyphosate while still providing the same effectiveness in killing weeds. With current trends, glyphosate will likely play a less and less significant role in the global marketplace.
For more information on China’s glyphosate market, please check our Glyphosate China Monthly Report.