Global Tricalcium Phosphate Market Likely to Show Optimistic Outlook in the Upcoming Month

Following a sustained decline in the price trajectory of Tricalcium Phosphate (TCP) in both the Chinese and US markets, market participants will likely experience an optimistic market situation in August 2023. The recent price drop is due to several factors, including increased supply from China, decreased demand from the US, and the ongoing Russia-Ukraine conflict. However, these factors are expected to abate in the coming months, leading to increased demand and a price rise. As a result, market participants will likely see an improvement in their profitability in the coming months. This is particularly true for those who have secured lower-priced long-term contracts.

TCP is a compound used in a variety of applications, including feed supplements, fertilizers, and plastics. Prices for TCP are likely to rise in August, and a number of factors are likely to contribute to further price increases in August. One factor that is driving up TCP prices is the increase in demand for feed supplements. The global livestock population is expected to grow by 1.7% in 2023, requiring more feed supplements. TCP is a key ingredient in many feed supplements, so the increase in demand for feed supplements will likely lead to higher prices for TCP.

Another factor that is contributing to the rise in TCP prices is the increase in demand for fertilizers. The global fertilizer market is expected to grow by 2.5% in 2023, requiring more phosphate-based fertilizers. TCP is a key ingredient in many phosphate-based fertilizers, so the increase in demand for fertilizers will likely lead to higher prices for TCP. Also, the increase in energy cost is a major input cost to produce TCP, and the increase in energy prices will likely lead to higher prices for TCP.

Moreover, the prices of raw material Phosphoric Acid increased, cost support was strengthened, and the rise in raw material prices slightly boosted the TCP market. Downstream enterprises were cautious in procurement, with poor enthusiasm for procurement, maintaining a wait-and-see attitude, prioritizing procurement on demand, and suppressing price inquiries. The manufacturer primarily placed initial orders, but there was limited inventory available on-site, and they were hesitant to sell at lower prices. As a result, the supply and demand remained relatively stagnant.

Ukraine is a major producer of TCP, and the war has disrupted production and exports. This has led to a shortage of TCP on the global market, pushing prices up. The phosphate rock industry faces several challenges, including rising energy costs and environmental regulations. These challenges make it more difficult and expensive to produce phosphate rock, a major input for TCP.

China is a major importer of TCP, and the strong demand from this country is putting upward pressure on prices. China is the world's largest consumer of animal feed, and it is also a major producer of fertilizers. This strong demand for TCP will likely continue in the coming months, keeping prices elevated. Meanwhile, the Chinese government ordered the temporary closure of some phosphorus factories in the lead-up to the 2023 World University Games in Chengdu, Sichuan Province. The Chinese government is ensuring that the air quality in Chengdu is as good as possible for the games. Closing these factories is just one of the measures the government is taking to improve air quality. This will further affect the production process and, likewise, propel the market prices to soar.