1. yellow phosphorus market prices continue to rise this week

Figure 1 Yellow phosphorus market price trend

This week, the price of yellow phosphorus market rose sharply, the downstream acceptance of high prices is still acceptable, inquiries and procurement enthusiasm is higher, so that the price of yellow phosphorus market continues to rise. As of the 22nd, China's yellow phosphorus market transactions up to 34000 yuan/ton near, sporadic high-end prices to 34500 yuan/ton, enterprises reluctant to sell sentiment is strong, some enterprises temporarily do not export, the plan price up to a high level after the resumption of export. Overall, the yellow phosphorus market prices to maintain the upward trend, the industry continues to bullish on the market price. The main reasons for this price rise are as follows:

1. yellow phosphorus market starts slightly lower

Table 1 Output analysis of yellow phosphorus market by province

According to incomplete statistics from Longzhong Information, the current daily output of yellow phosphorus in Yunnan is around 1025 tons, a slight increase of 10 tons from February 16, and the Yunnan South Phosphorus Plant has slightly increased. At present, the daily output of yellow phosphorus in Sichuan is around 420 tons, down 80 tons from last week. Qixing yellow phosphorus plant has been suspended for about a week due to line maintenance. The start of yellow phosphorus enterprises in Guizhou is basically stable, and the daily output of yellow phosphorus in Guizhou is around 440 tons.

On the whole, at present, the daily output of yellow phosphorus in Yunnan, Guizhou and Sichuan provinces in China is around 1885 tons, which is about 70 tons lower than that on the 16th. Under the condition that the overall supply is slightly tight, individual factories have reduced their output, which supports the market.

2. Winter Olympics end, downstream demand recovers

The Winter Olympics ended on the 20th. With the end of the Winter Olympics, downstream enterprises such as phosphorus trichloride and pesticides in North China, Central China and Jiangsu will resume production, and the demand side will boost the market. At the same time, with the early inventory of yellow phosphorus digestion, the downstream appropriate amount of resumption of procurement, coupled with the price of yellow phosphorus continued to rise, the downstream hoarding of goods enthusiasm, the overall market demand increased significantly compared to the previous period.

Rumors of 3. Power Restriction Affect Downstream Purchasing Mentality

After the Spring Festival, there have been repeated reports of power rationing in Yunnan. It is rumored that the electrolytic aluminum industry in Yunnan will gradually resume production in March, the electricity consumption in the yellow phosphorus industry will be limited, and the electricity consumption in the province or limited measures will be taken. Some enterprises said that the electricity purchase in March was limited. Downstream enterprises are highly concerned about the power rationing policy. Under the influence of rumors, procurement is more active in case of raising the price of yellow phosphorus after the subsequent power rationing policy. At the same time, yellow phosphorus enterprises and traders also follow the news of power rationing, the atmosphere is stronger. Under the influence of power rationing rumors, the price of yellow phosphorus continues to rise.

4. raw material prices rise, cost support

The price of raw material yellow phosphate rock has recently been reported to have risen again. In addition, coke has risen slightly by 200 yuan/ton. It is reported that the electricity price in Yunnan region increased slightly by 2-3 points in March. In terms of cost or multiple favorable supports, it has formed a strong supporting role for the market price of yellow phosphate.

At the same time, the recent heavy snow in Yunnan, road closures in many places, and poor transportation have blocked the transportation of yellow phosphorus and aggravated the tight supply situation. In addition, traders and production enterprises are reluctant to sell, deliberately pushing up the mood, but also make the price of yellow phosphorus rise rapidly.

In summary, with the help of multiple factors, Longzhong Information expects the subsequent yellow phosphorus market price to remain upward, and the price may rise to 38000-39000 yuan/ton.