China's halt in Diammonium Phosphate (DAP) exports, effective December 1, 2024, due to rising feedstock costs, is expected to reduce global supply until exports resume in April 2025, tightening availability. In North America, upcoming tariffs on imports, including Chinese products, will further strain the US market, raising prices for farmers. Meanwhile, US DAP imports have declined, compounded by typical seasonal decreases and weaker demand from key markets like Mexico and Brazil, likely impacting global market dynamics in the short term.

China has announced a halt in the export clearance of DAP starting December 1, 2024, due to rising feedstock prices, which now account for around 30% of the cost of producing processed phosphates. While shipments to key markets, including Brazil, Australia, and Ethiopia, will proceed for orders already confirmed, this move is expected to significantly reduce global supply, with exports resuming only in April 2025. A similar halt in 2023 saw exports continue through mid-January, but the market will likely face tighter availability until next year.

In North America, disruptions loom as President-elect Donald Trump’s 25% tariff on all imports, including a 10% tariff on Chinese products, takes effect on January 25, 2025. Mexico and Canada, key exporters of DAP to the US, could see their shipments affected, with Mexican exports representing a significant portion of US DAP imports. This tariff impact, compounded by limited availability from China, could lead to higher prices for US farmers, who are already grappling with affordability challenges.

The US has imported 190,000 tonnes of DAP between January and September 2024, with total imports expected to reach 240,000 tonnes by the end of the year. The halt in Chinese exports, combined with the tariffs on Mexican imports, is expected to further strain the US market, leading to higher prices despite a forecasted drop in demand due to weak affordability.

Simultaneously, U.S. container imports declined in November 2024, reflecting seasonal trends, with reduced imports from China, though still higher than last year, indicating resilience in U.S.-China trade. This, along with the Thanksgiving holiday disrupting trading in the US NOLA market, is expected to slow DAP flow, tightening global supply and increasing price volatility.

At the same time, the demand for Diammonium Phosphate (DAP) remains stable, driven by strong agricultural needs and increasing domestic fertilizer consumption, particularly in China. However, rising production costs have led to a government-imposed halt on DAP exports from December 2024 to April 2025, reducing global supply. Export demand is also facing challenges, with weaker harvests in Mexico and reduced wheat production in Brazil dampening demand from key markets, potentially impacting the global DAP market in the short term.