China's 2016 spring ploughing signals the busy season for the pesticide market, among which the herbicide market is the first beneficiary. In particular, amide herbicides have been very popular.

At present, China's amide herbicides are in a good market where the supply of upstream raw materials is tight but the demand from the downstream market is high. Firstly, the prices of upstream raw materials like chloroacetyl chloride and MEA rise rapidly. The tight supply is largely due to environmental pressures. Chloroacetyl chloride price quotations have risen up to USD1,835/t (RMB12,000/t) at some factories, which undoubtedly supports the amide herbicide price to go up.

Secondly, as the demand from herbicide end users expands and formulation processors begin to purchase technical according to their production plans, the entire herbicide market is entering into the busy season. In general, March to April every year is China's spring ploughing period. Amide herbicides including acetochlor, metolachlor and pretilachlor are selective pre-emergence herbicides. They are important herbicide varieties during the spring ploughing period and have large market demand during this period.

Acetochlor TC, metolachlor TC and pretilachlor TC are in great demand and are in tight supply because of the current strong market. This is mainly because formulation suppliers need time to stock up goods for the start of the market demand. However, most TC manufacturers have inventories to consume since these products did not sell well in 2015. As of early-March 2016, most amide herbicide TC manufacturers are still suspending their production and their supply of goods is based on the previous inventories. But influenced by the rising price of upstream raw material, the prices of above three herbicide TC are increasing.

Domestic formulation prices are also increasing because of the rising TC price. In 2015, the lowest ex-works price of acetochlor TC was USD2,575/t (RMB16,500/t). The price has rebounded to about USD2,767/t (RMB18,000/t) now, a growth rate of 9.1%. At present, the quotation of metolachlor TC reaches USD3,705/t (RMB24,100/t), up by 4.8% when compared to the bottom price of USD3,518/t (RMB23,000/t) during 2015. The price of pretilachlor TC has also rebounded, but its growth rate is lower than the other two formulations. In detail, the quotation of pretilachlor TC is about USD4,997/t (RMB32,500/t), about USD153/t (RMB1,000/t) above the 2015 low, and a rise of 3.1%.

Industry insiders forecast that the prices of related formulations will keep rising in the short term due to the rising processing costs. But if the market fluctuates, prices will also be affected.

Acetochlor, metolachlor and pretilachlor are major pre-emergence herbicides in China, with relatively high consumption. Nevertheless, due to the serious capacity expansion and overcapacity, the prices of these herbicides have not recorded large rises in recent years. History indicates that the prices of these herbicides will not rise significantly in the future. Currently, Nantong Jiangshan Agrochemical & Chemical Co., Ltd., Henan Yintai Chemical Co., Ltd. and Shandong Binnong Technology Co., Ltd. are main amide herbicide TC producers in China.

Ex-works prices of pretilachlor TC, acetochlor TC and metolachlor TC in China, Jan. 2015-March 2016

Source: CCM

About CCM:

CCM is the leading market intelligence provider for China’s agriculture, chemicals, food & ingredients and life science markets. Founded in 2001, CCM offers a range of data and content solutions, from price and trade data to industry newsletters and customized market research reports. Our clients include Monsanto, DuPont, Shell, Bayer, and Syngenta.

Tag: amide herbicides

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