The minor MOP adjustment (RMB 20-50/t decline) follows China’s $346/t CFR contract settlement, while SOP resilience reflects tightened resource-based plant operating rates below 60%.
1. MOP Price Trends & Contract Impact
Last week, China’s muriate of potash (MOP) prices declined by RMB 20-100/t (tonne, same below), with the downward momentum accelerating. This correction primarily stems from the conclusion of China’s annual potash contract. Signed on June 12 at $346 CFR, the contract undercuts India’s settlement (reached June 4 at $349 CFR) by $3/t. Despite the $73/t year-on-year increase, China retains its position as the global potash price floor, given prevailing international prices of $360-370/t. Industry analysts confirm this contract will bolster supply security in coming months.
2. Domestic MOP Supply-Dynamics
Operating rates at Chinese MOP producers remain subdued due to maintenance shutdowns. Logistics constraints have tightened spot availability, pushing Qinghai’s 60% powder ex-works prices down to ~RMB 2,950/t.
3. Imported MOP Market
Port inventories edged down to 1.9-1.95 MMT (million metric tonnes), though customs data show robust May imports. Prices adjusted downward:
-
62% white MOP: RMB 3,100/t (low-end reportedly RMB 3,050/t)
-
60% red granules: RMB 3,150/t
Border trade transactions stagnated, with 62% white MOP sliding to ~RMB 2,880/t as buyers resisted premium offers.
4. Sulfate of Potash (SOP) Segment
SOP prices held stable amid weak demand. Producers face:
-
Slow offtake and rising inventories
-
65% operating rate for Mannheim-process SOP plants
-
Cost-price inversion observed at some facilities
Current price benchmarks: -
Mannheim 52% soluble powder: ~RMB 3,700/t ex-factory
-
Resource-based 50% powder: ~RMB 3,450/t delivered
Upcoming shift: Resource-based SOP producers will commence comprehensive maintenance, potentially slashing output and providing price support.
5. Market Outlook
With the fertilizer sector in seasonal lull, weak conditions may persist through July. Post-contract settlement has eased near-term shortage concerns, potentially extending price declines. However, structurally tight global supply could trigger intermittent rebounds, as international prices remain poised for upside.
