Glufosinate ammonium

Recent Market Intelligence Report on Glufosinate-ammonium

I. Price Trend
- Current Price: The mainstream quotation for glufosinate-ammonium technical material has surged strongly above RMB 50,000 per ton; the equivalent price of high-purity (L-) glufosinate-ammonium (on 100% active ingredient basis) has risen to over RMB 65,000 per ton.
- Historical Price: Since the second half of 2025, glufosinate-ammonium prices have rebounded from RMB 44,000/ton to approximately RMB 46,000/ton; by June 2026, prices further climbed above RMB 50,000/ton.

II. Supply and Demand Situation
- Supply Side:
- Operating Rate: Industry-wide operating rates remain above 80%, with leading enterprises nearing full capacity utilization. However, due to accumulated export and domestic sales orders from earlier periods, factory and distribution channel inventories have dropped to multi-year lows.
- Inventory Level: As of January 2026, total domestic factory inventory stood at approximately 4,140–4,150 metric tons—reaching the lowest level since 2024, sufficient to meet only about half a month’s market demand.
- New Capacity: Inner Mongolia Lingsheng Crop Science Co., Ltd. plans to construct a 20,000-ton-per-year L-glufosinate-ammonium production facility; however, overall new capacity additions remain limited, with industry focus primarily on optimization of existing facilities.
- Demand Side:
- Domestic Demand: The spring farming season started earlier than usual, driving robust demand for glufosinate-ammonium in domestic cash crops, photovoltaic power stations, orchards, and other non-agricultural applications—growth exceeding 15% year-on-year.
- Export Demand: Overseas buyers rushed to secure orders ahead of the cancellation of export tax rebates, coinciding with South America’s soybean and corn planting season and Southeast Asia’s restocking needs—resulting in a sharp surge in short-term export orders and significantly extended production lead times, now stretching into mid-to-late June or even July.
- GM Crop Adoption: Cultivation area of herbicide-tolerant (glufosinate-resistant) genetically modified (GM) soybeans, maize, and rapeseed continues expanding globally, underpinning long-term overseas demand.

III. Cost Structure
- Raw Material Costs: Prices of key basic chemical feedstocks—including yellow phosphorus, phosphorus trichloride, and methanol—remain elevated year-on-year, resulting in a rigid upward shift in technical material production costs. Under tight supply conditions, manufacturers possess strong pricing power.
- Cost Divergence: Leading enterprises (e.g., Inner Mongolia Mingsheng, Shandong Yisheng) benefit from economies of scale, with production costs around RMB 40,000–45,000/ton, enabling modest profitability; in contrast, smaller-scale producers (e.g., Yongnong) face higher costs near RMB 50,000/ton due to limited capacity (10,000–20,000 tons/year), leading to cost-revenue inversion.

IV. Policy Impact
- Cancellation of Export Tax Rebate: Effective April 1, 2026, the export tax rebate for glufosinate-ammonium technical material was officially abolished, prompting overseas buyers to place bulk orders before the impending cost increase—further fueling price hikes.
- 'One Product, One Registration Certificate' Policy: Full implementation is expected by mid-2026. Technical material producers will be required to hold valid registration certificates to manufacture; formulation enterprises relying on borrowed certificates must liquidate their inventory before mid-2026. This policy will drive market consolidation, reduce destructive price competition, and enhance profit stability for leading enterprises.

Analysis & Assessment

I. Drivers of Price Increase
- Confluence of Policy Timing and Supply-Demand Dynamics: The export tax rebate cancellation triggered a 'rush-to-export' effect; sustained high operating rates depleted inventories, social inventories fell to historically low levels, elevated raw material costs established a firm floor, and expanded adoption of glufosinate-tolerant GM crops reinforced underlying global demand.
- Improved Industry Structure: Following the period of overcapacity and depressed pricing between 2021–2023, the supply-demand balance has steadily improved since 2024, initiating a sustained price recovery. Inefficient capacity has been rapidly phased out, industry concentration increased, and technological advantages of leading players have become more pronounced.

II. Constraining Factors
- Cautious Procurement by Domestic Formulators: Domestic formulation enterprises are purchasing only small, just-in-time quantities of technical material priced above RMB 50,000/ton, with large-volume orders scarce.
- Channel Inventory Pressure: Should previously idled production lines resume operations in late June, coupled with concentrated selling of lower-cost inventory held by distributors, market tightness may ease marginally.
- Accelerated L-Glufosinate-ammonium Capacity Release: Rapid expansion of high-purity L-glufosinate-ammonium production capacity will exert medium-to-long-term downward pressure on the premium enjoyed by racemic glufosinate-ammonium.

Forecast

I. Short Term (Early–Mid June)
- Price Trend: Glufosinate-ammonium technical material prices are likely to remain range-bound at RMB 50,000–52,000/ton. A significant decline is highly improbable in the near term; however, without unexpected large export orders, further substantial upside is also limited.
- Market Dynamics: Factories are fully booked; spot availability is extremely tight; traders are holding stocks tightly amid expectations of further price increases.

II. Medium Term (Late June–July)
- Price Trend: Close monitoring is warranted regarding resumption timelines of previously halted facilities and follow-up on new export orders from South America. If new major export contracts are secured, a modest upward adjustment remains possible; conversely, if channel turnover remains sluggish, minor softening at the upper end of the current range may occur—but a drop below RMB 48,000/ton appears unlikely.
- Market Dynamics: Previously idle production lines may restart operations; distributors may release previously accumulated lower-cost inventory, leading to a marginal easing of spot market tightness.

III. Long Term (Second Half of 2026 through 2027)
- Price Trend: Glufosinate-ammonium prices are expected to sustain at elevated levels, supported by continued optimization of supply-demand fundamentals, enhanced technological leadership among top-tier enterprises, and steady growth in demand driven by GM crop adoption.
- Market Dynamics: Industry concentration will further increase, with leading enterprises expanding market share; the combined market share of L-glufosinate-ammonium and racemic glufosinate-ammonium will dynamically rise.