Fertilizer stocks surge amid China’s ammonium phosphate export controls
South Korean fertilizer companies witnessed a notable increase in their stock prices on Friday, following reports that China has initiated stringent export controls on ammonium phosphate, a key component in chemical fertilizers. This development comes as China further tightens its grip on fertilizer exports, having previously halted urea exports to Korean companies.
Hyosung ONB Co., a prominent Korean organic fertilizer firm, saw its shares on the secondary Kosdaq market climb to 9,210 won ($7.03) as of 9:11 a.m. on Friday, marking a substantial 23.96 percent rise from the previous trading day. Similarly, Nousbo Co., another key player in the fertilizer industry, experienced a 12.1 percent surge in its stock value. On the primary Kospi market, Chobi Co. shares also jumped, recording an 18.23 percent increase.
The surge in stock prices is primarily attributed to the recent move by the Chinese government to regulate the export of ammonium phosphate. According to industry insiders, the National Development and Reform Commission (NDRC) of China issued a directive in November 2023 to halt export inspections for ammonium phosphate, effectively suspending new export procedures for this critical raw material.
This decision by China poses significant challenges for South Korea, which relies on its neighbor for a staggering 95 percent of its ammonium phosphate supply. The growing concern among Korean companies and stakeholders is the potential impact on the nation’s fertilizer supplies, should China continue with its export control measures.
The situation underscores the delicate balance in global trade relationships, particularly in sectors critical to agriculture and food production. As South Korean fertilizer stocks react to these developments, the industry braces for potential ramifications in supply chains and pricing structures in the coming months.
Enjoyed this story?
Every Monday, our subscribers get their hands on a digest of the most trending agriculture news. You can join them too!
Exciting times in Oryza! Our new platform is set to transform agriculture, bringing real change to farmers' lives. I am proud to be a part of Oryza's mission to transform agriculture with technology, empower farmers and drive sustainability. I strongly believe our focus on innovation and collaboration is key to the future of agriculture.
Discussion0 comments