August 26 Pesticide Daily Review: Support Factors Remain Subject to Change

The pesticide market remained generally weak in sentiment. Downstream demand follow-up was limited during the traditional off-season, leaving the market without sufficient drivers. The logic supporting higher costs has moderated as geopolitical tensions eased. Some products still have cost support, while supply has contracted to some extent due to various factors. However, price increases have continued to trigger negative feedback downstream because of weak transmission along the industrial chain, and the market is waiting to see whether end-user demand can provide stronger support. New signs of peace have emerged in the Middle East. US-Iran tensions have eased to some extent through mediation by intermediary countries, while Iran and Oman continue to advance an agreement on navigation through the Strait of Hormuz. The market has strengthened expectations of a resumption of shipping, and energy costs may decline further. Overall, market caution persists. Price increases among some upstream products continue to face resistance in transmission to downstream markets, upward momentum has paused, and the wait-and-see mood remains apparent. Attention should remain on geopolitical developments, export activity, and seasonal demand.

Market Analysis

Herbicides: The herbicide market is currently consolidating at low levels. Prices are close to the cost line, leaving limited room for further declines, but weak demand is also limiting upside potential. Although geopolitical risks continue to support higher costs, insufficient demand absorption has failed to provide market momentum. On the policy side, the United States has invoked the Defense Production Act to designate elemental phosphorus and glyphosate-based herbicides as critical defense materials, requiring priority supply to the domestic market. This continues to provide some international support for the domestic market. Overall, downstream buyers are mainly purchasing to meet rigid demand. The market atmosphere is weak in the short term, and attention should focus on whether exports improve and on changes in geopolitical sentiment.

Yellow Phosphorus: Yellow phosphorus prices continued to rise today. Expectations of some tightening in supply from Guizhou supported prices, with other regions following the move. Producers are currently mainly shipping contracted orders, and sales by mainstream producers are relatively strong, while midstream and downstream participants are restocking in line with higher prices. On the upstream side, producer inventories remain relatively limited in the short term, and some producers have recently reduced output, leaving conditions for price support in place. However, downstream acceptance of high prices remains under consideration. In the short term, upstream producers are shipping contracted orders and downstream purchasing is acceptable. Attention should focus on the sustainability of demand follow-up after the price rebound. If follow-up slows, market sentiment may again come under pressure. The market is expected to remain relatively firm but volatile for now.

Pesticide Market Price Overview

Herbicides:

90% clethodim fell by 3,000 yuan to 75,000 yuan/tonne.

Insecticides:

96% lambda-cyhalothrin fell by 1,000 yuan to 105,000 yuan/tonne; 96% bifenthrin fell by 1,000 yuan to 125,000 yuan/tonne; 97% imidacloprid fell by 2,000 yuan to 70,000 yuan/tonne; 97% dinotefuran rose by 2,000 yuan to 110,000 yuan/tonne; 96% chlorantraniliprole rose by 5,000 yuan to 230,000 yuan/tonne.

Fungicides:

98% dimethomorph fell by 2,000 yuan to 58,000 yuan/tonne; 96% thifluzamide fell by 5,000 yuan to 230,000 yuan/tonne; 95% boscalid fell by 5,000 yuan to 255,000 yuan/tonne.