China’s 2,4-D Price Presented Significant Downward Trend Affected by Weak Market Demand In July 2015

Date: 2015-08-11

“For nearly two month, China’s 2,4-D price presented significant downward trend affected by weak market demand. It is predicted that the price will continue staying at a low level with low probability of rebound.

In recent years, flucarbazone-Na is increasingly popular among industry insiders. Currently, many enterprises are planning to develop flucarbazone-Na formulations, because they consider this will be a potential growth point in China’s future herbicide market.

In China, 2,4-D plays a leading role in herbicide industry, based on its output, export volume and consumption. If IARC’s findings on 2,4-D finally causes forbidden upsurge of 2,4-D, how will these affect China’s 2,4-D industry?

In the face of auspicious opportunity of glufosinate-ammonium market in recent years, Lier Chemical is actively developing its glufosinate-ammonium business by launching new projects to expand the capacity of glufosinate-ammonium, in order to gain the competitive edge. Lier Chemical is expected to become the leader in China’s glufosinate-ammonium industry.

In H1 2015, total revenue and net profit of Lier Chemical recorded YoY rises of 11.01 % and 22.09% respectively. And the good performance of glufosinate-ammonium business became the mainspring of its sales increase.

On 18 July, 2015, Shenghua Biok announced that it has canceled its non-public stock offer and that it is preparing for a major asset restructuring. Shenghua Biok will turn into an online gaming enterprise, rather than an online agricultural financial enterprise. This is largely because its actual controller and controlling shareholder has changed.

Jiangsu Huifeng plans to become Shijiazhuang Ruikai’s shareholder with investment of USD43.99 million (RMB263 million) to further develop glufosinate-ammonium business.

In Jan.-April 2015, China’s export volume of fomesafen increased by 34.28% year on year, which was mainly due to the YoY rise of 172.24% in the export volume of fomesafen formulations.

In June 2015, 24 herbicide TC obtained registrations in China, increasing by 12 month on month. Of this, active ingredients bentazone, imazamox, nicosulfuron and clethodim obtained two TC registrations respectively.

In H1 2015, China has 70 new registrations of herbicide TC including 41 herbicide active ingredients. Thereinto, 15 active ingredients obtained more than two TC registrations respectively.

In H1 2015, China has 329 new herbicide formulation registrations, among which there were 124 active ingredient combinations. Of this, 203 registrations were for single formulations and 126 were for mixed formulations.

As of July 2015, no company has achieved large-scale production and sales of non-AS paraquat. Nevertheless, Shandong Luba disclosed that its 50% paraquat SG will be launched onto the market in 2016. Besides, QR codes will be added on the packages.

In H1 2015, China’s herbicide industry remained sluggish. In July, along with the coming slack season of market demand and hot weather, the downturn of herbicide market is further serious. The prices of glyphosate, paraquat, 2,4-D, acetochlor, atrazine and other bulk products all record different degree of declines. Especially the prices of glyphosate, paraquat and 2,4-D are difficult to rebound in the short term. Nevertheless, it is worth noting that glufosinate-ammonium is always the special case in herbicide market. Due to over-demand, glufosinate-ammonium price maintains at relative high level all the time, which attracts much attention from manufacturers. At present, Lier Chemical’s newly-constructed glufosinate-ammonium production line (capacity: 1,000 t/a) is put into production. Meantime, its another 1,000 t/a production line of glufosinate-ammonium is under construction. Jiangsu Huifeng also holds positive attitude toward the market prospect of glufosinate-ammonium. It has acquired Shijiazhuang Ruikai to go in for glufosinate-ammonium business.

Notably, Shandong Luba’s new product, paraquat SG will be launched on the market in 2016, whose package is printed with QR code. It is estimated that paraquat formulations will still occupy a certain proportion of shares in China’s pesticide market.

The USD/RMB exchange rate in this issue is USD1.00=RMB6.1149 on 1 July, 2015, sourced from the People’s Bank of China. All the prices mentioned in this report will include the VAT unless otherwise specified.The USD/RMB exchange rate in this issue is USD1.00=RMB6.1149 on 1 July, 2015, sourced from the People’s Bank of China. All the prices mentioned in this report will include the VAT unless otherwise specified.

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