In the first half of this year, the fertilizer industry faced challenges due to limited raw material supply and rising costs. Despite these difficulties, the sector was well-organized and strategically planned to ensure stable production and high output, successfully supporting the spring planting season. Overall, the industry demonstrated steady and sustained growth.
First, there was a steady increase in product output. During the first six months of the year, the country produced 30.624 million tons of chemical fertilizers, representing an 8.3% rise compared to the same period last year. Nitrogen fertilizer production reached 21.536 million tons, up 2.3% year-on-year, while phosphorus fertilizer output rose to 7.173 million tons, a significant 29.8% increase. Potash fertilizer production totaled 1.914 million tons, up 17.4% from the previous year. This performance ensured adequate supply for the spring farming season.
Second, economic returns improved rapidly. In the first five months of the year, the fertilizer industry reported total profits of RMB 14.9 billion, a 76.8% increase compared to the same period last year. The nitrogen fertilizer sector earned 4.02 billion yuan, a 119.1% rise, while phosphate fertilizer companies made 1.51 billion yuan, up 117.1%. Potash fertilizer profits reached 3.07 billion yuan, a 45.1% increase. However, despite the overall improvement, the profit margin remains low, with nearly one-third of nitrogen fertilizer companies still operating at a loss.
Third, capital investment saw some optimization. From January to June, the industry completed a total investment of 47.86 billion yuan, a 21.9% increase year-on-year. However, this growth was lower than the national fixed asset investment growth by 3.7 percentage points. There were 1,161 construction projects, a 13.4% decline, and 654 new projects started, down 17.1% from the previous year. Notably, the phosphate fertilizer industry, which faces overcapacity, saw a 11.2% drop in investment, with construction projects falling 20.6% and new projects declining 32.9%. Meanwhile, the nitrogen fertilizer industry experienced a 30.6% decrease in construction projects but saw a 20.2% rise in investment, signaling a shift toward advanced technologies and larger-scale facilities.
Overall, the fertilizer industry showed continuous improvement in operations during the first half of the year, successfully fulfilling its supply obligations. During the spring farming period, domestic fertilizer prices were more than 300 yuan cheaper than international market prices, helping reduce farmers' input costs. However, challenges remain, including excess capacity in phosphate fertilizers, small-scale nitrogen fertilizer operations, low technological standards, and insufficient production of low-cost products. Relevant authorities and enterprises should continue to strengthen efforts, actively promote adjustments in raw material and energy structures within the nitrogen fertilizer sector, strictly control new phosphate fertilizer capacity, accelerate the elimination of outdated production facilities, and enhance the ability to supply affordable fertilizers.
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