Global Potassium Carbonate Market Shows Mixed Trends in July Amid Supply Disruptions and Shifting Demand

In July 2024, Potassium Carbonate prices exhibited divergent trends across different regions. The Asian market witnessed a price surge, primarily driven by supply shortages. Conversely, prices of Potassium Carbonate in the European market experienced a significant decline, attributed to moderately low demand from the key downstream fertilizer industry, which was influenced by fluctuating weather conditions.

The European Potassium Carbonate market experienced a significant dip in prices, primarily owing to moderately low demand in the market, The domestic market within the European Union has been particularly affected by adverse weather conditions, including excessive rainfall across Austria, France, Italy, Germany, and the Netherlands. These varied weather patterns have adversely impacted crop growth and hindered field operations throughout the region and neighbouring areas. The challenges stemming from unpredictable weather conditions have introduced uncertainties in agricultural activities, significantly influencing the demand for ammonia. Farmers and agricultural stakeholders in affected regions have faced difficulties in managing crops due to the adverse effects of excessive rainfall, which has dampened the immediate need for Potassium Carbonate as a fertilizer.

Similarly, during the same month in review, the price of Potassium Carbonate surged by a significant margin, mirroring the trend followed in the previous month. This price surge is primarily attributed to shortage of both domestically produced and imported Potassium Carbonate in the Indian market. During this period the manufacturing units within the country were operating at a reduced rate indicating towards shortage of domestically produced material in the Indian market. According to data released by the Ministry of Statistics and Programme Implementation (MOSPI), the Quick Estimates of the Index of Industrial Production (IIP) for June 2024, based on the 2011-12 base year, stands at 150.0. This marks a slight increase from 143.9 in June 2023 but a decrease from 154.6 in May 2024. The sectoral breakdown of the IIP for June 2024 reveals that the indices for the Mining, Manufacturing, and Electricity sectors stand at 134.9, 145.3, and 222.8, respectively. Despite the overall year-on-year growth, the decline in the industrial production index from May to June 2024 indicates a slowdown in industrial activity. This decline is anticipated to persist in July 2024 as well. This reduction in production levels suggests that factories and manufacturing plants are operating below capacity, which can have significant implications for the supply of various goods, including Potassium Carbonate.  In addition to this, persistent port congestion in the exporting countries has eventually led to increased supplier delivery time and delayed exports of various commodities including Potassium Carbonate from the overseas market.

Despite this, the demand of Potassium Carbonate within the Indian market remained muted. Data released by The Indian Department of Agriculture and Farmers Welfare reported that 83, 031 hectares were used this year for major crop sowing during Kharif 2024, which is 0.2% less than the previous year. This extreme weather event has significantly impacted the fertilizer industry, leading to reduced demand for Potassium Carbonate.

According to ChemAnalyst, the global price of Potassium Carbonate is expected to decrease in the coming months. This forecast is attributed to a decline in sales during the off-season when demand is low. In addition, the reduction of raw material costs may help reduce the cost of Potassium Carbonate, because the reduction of input costs often leads to reductions in the price of the final product.