Recently, domestic potash fertilizer prices have risen by CNY50-100 per ton compared to the beginning of the year. Currently, domestically produced 60% white potash is priced at CNY 3,300 per ton, border trade 62% white potash at CNY 3,400 per ton, and port 62% white potash at 3,500 yuan per ton. Global potash supply and demand remain tight, with the industry poised for sustained high growth over the next 2-3 years.

Potassium chloride demand is expected to further replace nitrogen/phosphate fertilizers at a rate of 2%-3%. Since 2024, robust potash demand from China, India, and Brazil, coupled with low inventory levels, indicates significant upside potential for global potash prices.

Domestic potash inventories remain low, supporting upward price momentum for spring planting season

China's total potash production in 2025 is projected at 5.82 million tons, down 380,000 tons (year-over-year -6%). As of January 15, domestic port potash inventories stood at 2.51 million tons, up 30,000 tons month-over-month but down 450,000 tons year-over-year, with state reserves still requiring 1.5 million tons to replenish stocks. By late November 2025, the annual “big contract” for domestic potash fertilizer was signed at $348/ton (up $2/ton YoY), primarily due to significant pressure to secure spring planting supplies, leading to a significantly earlier signing date than previous years. Currently, domestic 60% white potash is priced at 3,300 yuan/ton, border trade 62% white potash at 3,400 BMB/ton, and port 62% white potash at 3,500 yuan/ton—representing a 50-100 RMB /ton increase since the beginning of the year. Spring plowing accounts for approximately 50% of annual domestic consumption. Against the backdrop of low inventories, the sector anticipates an above-expectation surge in potash fertilizer prices during the spring planting season.

Global potash supply-demand tightens, with high industry growth expected over next 2-3 years

According to General Administration of Customs data, China imported 1.46 million tons of potassium chloride in December, up 3% year-on-year and 15% month-on-month. Total imports for 2025 reached 12.61 million tons, flat year-on-year. Overseas, Canpotex's Q1 2026 orders are fully sold out, with Indonesia's recent Q2 2026 tender quotes ranging from $400-408/ton (CFR). No new supply capacity is expected to come online in 2025. with only 2 million tons from Asia Potash International and 1 million tons from Belarus' Nezhinsky mine coming online in 2026-2027. Supply-side CAGR is projected at around 2%. BHP's Jansen potash mine Phase 1 in Canada increased capital expenditure by $1 billion to $8.4 billion, a 47% rise from the approved amount, with optimistic estimates suggesting production could commence in 2028. The marginal cost of new capacity in Belarus and Canada exceeds $250/ton FOB, providing strong cost support.

The global fertilizer market has entered a phase of high prices and tight supply-demand balance. Disruptions in overseas nitrogen and phosphate fertilizer supplies have pushed price levels upward, while potash fertilizer's high cost-effectiveness may drive demand beyond expectations. Currently, CFR prices in Brazil and Southeast Asia range from $360-380/ton, offering a favorable cost-performance ratio compared to nitrogen/phosphate fertilizers. . The bank believes potassium chloride demand could further substitute nitrogen/phosphate fertilizers beyond the existing 2%-3% substitution rate. Since 2024, robust demand from China, India, and Brazil coupled with low inventory levels has created significant upside potential for global potash prices.

As an integrated internet platform providing benchmark prices, on January 26th, the benchmark price of potassium chloride, according to SunSirs, was 3583.33 RMB/ton, an increase of 1.42% compared to the beginning of the month (3533.33 RMB/ton).

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