The price of Glufosinate ammonium bottomed out, and it is expected that the market can get out of the trough

Since November, with the support of the cost side and demand side, the market price of Glufosinate ammonium has bottomed out. 

After the "floor price" of 60,000 yuan (ton price, the same below) for nearly 3 months, the current average price of Glufosinate ammonium has risen to 70,000 yuan, an increase of nearly 17%. 

At present, the attitude of the supply side is firm, and the quotation of some enterprises is at a high level. The industry is expected that with the gradual release of agricultural demand, the promotion and application of superimposed mixed formulations and Glufosinate-p, the market will most likely go out of the trough and enter the boom cycle.

"With the gradual opening of winter storage and next year's procurement demand, Glufosinate ammonium ushered in the sales season. Especially in the recent period, the price has risen sharply, and some suppliers have raised the price of 95% Glufosinate ammonium raw powder to 75,000 yuan per ton." A dealer of agricultural materials in Henan said, "Now because some traders have low-price inventories in their hands, the price rise in these two days has been temporarily stable." But at present, the manufacturer has a firm attitude to price, and our shipment pressure is not big."

Glufosinate ammonium can replace Glyphosate to some extent. However, the price of glyphosate is 4 to 5 times that of Glyphosate, the cost of medication is high, and the market demand is limited. In recent years, under the influence of a large expansion of production on the supply side, the price of Glufosinate ammonium has fallen sharply and is now at a historic low. Since May 2022, its price has fallen from 265,000 yuan to 60,000 yuan in September this year, a drop of 77%.

In the past three months, the market price of Glufosinate ammonium has remained at 60,000 yuan, which has been close to the cost line, and some enterprises have suffered losses, and the market has been in a situation of no decline. Due to the arrival of the peak season, the demand side is supported, and the supply and demand are basically good.

In terms of inventory, the industry inventory is 0.41 million tons, which is relatively small compared with the total production capacity of 113,000 tons. Under the combined support of the cost side and the demand side, the Glufosinate ammonium market bottomed out.

Wu Junyan, an analyst at Donghai Securities, expects that the global herbicide market will reach 27.8 billion US dollars in 2026, which will still be the highest proportion of pesticide varieties and one of the most important pesticide varieties. Therefore, as one of the main herbicide products, Glufosinate ammonium has a broad market prospect.

"The demand for Glufosinate ammonium continues to rise." Limin said in accepting institutional investor research recently that with the gradual promotion of genetically modified crops, the continuous increase of weed species resistant to Glyphosate products, and the further substitution of glyphosate for Paraquat products in the market, It is generally expected in the industry that in the next 3 to 5 years, the demand for Glufosinate ammonium will increase from the existing 40,000 to 50,000 tons to about 100,000 tons.

Wu Junyan also believes that the promotion and application of mixed formulations and Glufosinate-p will further drive the demand for Glufosinate ammonium. 

In the aspect of mixed formulations, in order to improve the effectiveness of weed control, some formulations companies try to mix Glufosinate ammonium with other herbicides. Data from the China Pesticide Information Network show that since 2015, the number of registered formulations of Glufosinate ammonium and selective herbicides has increased from 3 in 2015 to 62 in 2021. From the quantity point of view, the mixed products of Glufosinate ammonium are still in the initial stage, and there are still large market development prospects.

 In addition, the policy of reducing pesticide quantity and increasing efficiency in China is expected to promote the popularization and application of Glufosinate-p. Glufosinate-p occurs naturally in nature and its herbicidal activity is about twice that of Glufosinate-p. Therefore, the large-scale promotion of the use of Glufosinate-p will effectively reduce the use of pesticides and environmental risks, in line with the current national pesticide reduction and efficiency policy, but also in line with the current environmental protection concept, is an important future development direction of Glufosinate ammonium industry.

Due to long-term optimism about the Glufosinate ammonium market, many pesticide backbone enterprises have laid out the fine Glufosinate-p market. 

Recently, Lier said in the reception of institutional investors research that the company is very optimistic about the market space of Glufosinate-p, the future with the gradual maturity of the production process, the reduction of production costs and the completion of the registration market layout, the scale of market demand will continue to grow.

Limin also said that the company's 10,000 t/a Glufosinate-p project has passed the environmental assessment in September this year. The company adopts the process of gas phase continuous method and biological continuous catalysis method, which can make full use of the existing equipment. The project is currently under construction and installation, and it is expected that the equipment will be put into operation by the end of this year.

With the support of the policy spring breeze, the agricultural demand market is optimistic, the downstream application field continues to expand, and the prospect of the Glufosinate ammonium market out of the trough is expected.