IM 2012 Round-ups: Phosphate

By Kasia Patel
Published: Friday, 21 December 2012

The phosphate market was hit this year as the downturn in economic climate filtered through to the fertiliser markets. As a result of this dip, 2012 spelled a slowdown for short-term fertiliser demand, especially in the Asian and European markets.

The phosphate market was hit this year as the downturn in economic climate filtered through to the fertiliser markets. As a result of this dip, 2012 spelled a slowdown for short-term fertiliser demand, especially in the Asian and European markets.

The year began with many companies, such as PotashCorp., reporting drops in sales volumes and decreased demand for phosphate in comparison to 2011 figures.

Prices also dipped in the first half of the year as new capacity came online in the Middle East, dealer’s remained reluctant to stockpile and prices pulled back in phosphate end markets.

The market moved back on track towards the second half, however, as phosphate sales volumes once again began to increase.

EU bans phosphates

In March, the EU announced plans to ban imports of phosphates from Syria as part of sanctions imposed on the government of President Bashar al-Assad.

Exports of phosphate from the Middle Eastern state to the EU were worth over Û97m ($128m) in 2010 and represented about 40% of Syria’s total exports of the fertiliser mineral.

The Syrian phosphate industry had faced severe conditions during the start of the year with transportation and production disruptions from protests as the mines are located in the Homs province, the heart of the Syrian revolution, and home of fertiliser plants and roads to export ports.

Chinese control phosphate

Also in March, the Chinese government sought to control the phosphate industry by buying out small companies.

After rare earths and fluorspar, phosphate is the third national strategic resource in China, with export quotas limited for 2012 by the Ministry of Commerce (MOFCOM).

The China Chemical Mining Association also announced in its ‘12th five-year development plan for chemical and mining industries’, that it would establish a phosphate reserves system; it also pledged to raise the level for phosphate mining approvals and focus on establishing one to three trans-regional and influential large phosphate corporations.

Indian contract delays

In India, where around 11m tpa diammonium phosphate (DAP) is consumed, 7m tpa phosphate rock was imported in 2011, according to Paris-based International Fertilizer Industry Association (IFA).

Of the 2.3m tonnes of phosphoric acid imported annually for fertiliser requirements in India, Morocco, South Africa, Senegal, Jordan, Tunisia and the US account for about 95% of total imports.

Jordan, Algeria, Togo, China, Egypt, Vietnam and Morocco account for about 98%. Africa’s contribution to Indian imports is 40-45% for phosphate rock, reaching 80-85% for phosphoric acid.

Minemakers refuses to renew phosphate

In Australia, phosphate developer Minemakers Ltd ended the joint-venture agreement with its partner National Mineral Development Co. Ltd (NMDC) of India in June.

The joint venture was a partnership in the development of the 1.6bn-tonne, grading at 11.6% P2O5, Wonarah phosphate project in Australia.