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High export prices
Glyphosate is a widely used herbicide with high efficiency, broad spectrum, low toxicity and no residue. In recent years, due to the expansion of genetically modified crops and the recovery and modernization of agricultural development in developing countries, market demand has grown rapidly, and sales volume has been increasing at a rate approaching 15% per year. It has been the world's number one pesticide sales leader for many years in a row.
In recent years, there has been a surge of glyphosate in our country, and some companies have turned products into this area and entered the international market in large quantities, making China one of the world's leading exporters of glyphosate. Zhejiang Xin'an Chemical Industry Group Co., Ltd. is the second largest glyphosate manufacturer in the world. Its current production capacity is about 50,000 tons/year and is expected to reach 100,000 tons/year by the middle of 2009. With strong export channel advantages and scale cost advantages, Xinan brand glyphosate has a certain influence in the international market.
Although the status of China's glyphosate industry is increasing internationally, it is a late start and the influence on the international market is relatively limited. And because most Chinese glyphosate companies lack registration in importing countries, most of the exports are completed through third parties, relying primarily on cost advantages. The profits that companies actually obtain are relatively low, and most of the profits are earned by middlemen. Before the end of 2006, although the export price of glyphosate in our country was up and down, it was relatively stable overall.
However, starting from this year, the original calm international glyphosate market seems to have been ripped off by a huge gap, supply suddenly became tense, dealers began to look for goods everywhere, and export prices have been rising. From January to August, the export price of glyphosate soared from 30,000 yuan/ton to 40,000 yuan/ton, and the market was still in short supply. Even in the traditional off-season, the market not only did not fade, but continued to strengthen.
Supply is the main reason
What are the reasons that led to such a big change in the international market for glyphosate? After visiting some of the glyphosate manufacturers and consulting some industry experts, the reporter learned that this is mainly caused by the contradiction between supply and demand.
It first stems from the rise in demand. On the one hand, it is the direct demand of agriculture itself. Since the 1990s, the large-scale planting of genetically modified glyphosate-tolerant crops such as soybeans and corn has increased the demand for glyphosate globally. Second, based on energy strategy considerations and the need to protect the environment, renewables have been utilized. The use of resources such as corn and soybeans as raw materials to produce renewable clean energy has become a trend in developed countries. As a result, the global acreage of crops has continued to grow, indirectly driving up the use of glyphosate herbicides.
Followed by the constraints of environmental protection, product supply is insufficient. From the perspective of the developed countries, the Environmental Protection Law strictly limits the development of chemical companies in the country. This is the reason why developed countries have advanced technologies for the production of glyphosate, but the reasons for the rapid expansion of production capacity are not. US Monsanto is the world's largest producer of glyphosate. Its production capacity accounts for about 45% of global production capacity. The market share of the world's glyphosate, which can be directly and indirectly controlled, reaches more than 70%. Last year, the company was closed for strategic reasons. A glyphosate production line was one of the most direct causes of the increasing global supply of glyphosate. From the domestic point of view, environmental issues have also become one of the most prominent social issues. Environmental pollution incidents such as the cyanobacteria in Taihu Lake this year prompted local governments to increase their efforts to rectify small chemical companies. Jiangsu shut down in the Taihu Lake Basin. Among the more than 1,000 small chemical companies, several are glyphosate manufacturers. At the same time, the improvement of environmental protection thresholds has also made it impossible for some companies with limited resources to enter this industry. The market gap cannot be filled quickly in the short term.
How long can Vaughan face the flames of the glyphosate market? What people are most concerned about is: How long can such a situation last? In response, people in the industry are mixed.
Some companies are pessimistic. They estimate that this situation may change next year. According to past practice, which products are good, related companies in various regions will move up and down, and then press each other's prices and compete in disguise; local governments have different management of the environment and security, resulting in different operating costs, resulting in “bad "Currency" expelled "good money", the market chaos and prices fell.
Optimistic companies believe that the growth of global demand for glyphosate is a big trend. In addition, after years of exploration, Chinese glyphosate companies have accumulated rich experience in manufacturing capacity, technology, and international marketing. It also has the advantages of low labor costs and resources, coupled with the country's ongoing efforts to strengthen the management of pesticides, the expansion of glyphosate production capacity must not be able to keep up with demand growth in the short term. Therefore, this shortage of supply will continue for at least two years. According to industry experts' forecasts, global demand for glyphosate will reach 900,000 to 1 million tons by 2010. As there is no new herbicide species that can replace glyphosate in the world, the global market life of glyphosate is at least There are 10 years.
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Glyphosate market ushered in Golden Pig
"The ordering of telephones kept ringing and many large orders were dropped. The factory had no time to produce." said one person in charge of the import and export branch of Zhejiang Xin'an Chemical Industry Group Co., Ltd., China's largest glyphosate manufacturer. “Now the export price has reached the highest level in history, at least more than 30% from the beginning of the year.†And Chairman Chen Zhongliang of Shanghai Kaipu Fine Chemical Co., Ltd. simply described this as: “The opportunity of the Millennium and so on. Really did not expect This year's glyphosate market will be so good!"