Fertilizer market continued to encounter oversupply in the period 2014-2015, nutrient supply by component is estimated to increase 4.03% while demand went up just 2.04%. The oversupply within the fertilizer industry and other exogenous factors affecting the global supply from 2014 until now are the lack of natural gas supply, the increase in volatility associated to trade measures and the sharp decline in oil prices.
Fertilizer prices decreased over years, mainly caused by the oversupply and the drop in prices of raw materials.
In Vietnam, players in the fertilizer industry are classified by business forms, namely Manufacturing Enterprises (produce mainly Urea, Phosphate, NPK and DAP), Import and Export Enterprises (import 100% of Kali and SA) and Trading Enterprises.
Average supply always exceeds 148% compared with demand. Domestic fertilizer production focused on single fertilizers. NPK and DAP are the only mixed fertilizers produced but the quality standard is still not satisfied yet, especially DAP. NPK accounts for over 40% of total production volume, followed by Urea, Phosphate and other mized fertilizers. Meanwhile, Potash and SA are nearly impossible to produce domestically, therefore 100% of which has to be imported.
Fertilizer consumption tends to drop over years due to the effects of agricultural products’ export price, the decrease in arable land and the negative impact of weather. Fertilizer import fluctuated continuously through years due to the impacts of domestic supply sources as well as the import tax policies of Vietnam and major import markets.
Export has continuously dropped since 2012, caused by the competition with Chinese fertilizers in Korea, Cambodia, etc. and the effect of El Nino on the countries in the region. Although following the global price trend, the increase and decrease rates of domestic price are always lower than those of the world. Presently, the technology in Vietnam is very various, ranging from old-fashioned to modern ones. In which, NPK is the easieast fertilizer to produce, therefore its production technology is the most various.
Fertilizer Industry is in saturation state, products of domestic companies have an intense competition with imported ones. Meanwhile, fertilizer demand tends to drop, leading to a downward pressure on prices in the period 2016 – 2020f.
– Phu My Fertilizer
– Binh Dien Fertilizer
– Petrovietnam Camau Fertilizer
– Lam Thao Fertilizer
– PVFCCo South East
– Quang Binh Import and Export
– PVFCCo Southern West
– PVFCCo Central
– The Southern Fertilizer
– PVFCCo North