【SMM Analysis】The FP market gradually recovered in March, with production showing a significant increase compared to February

In March, domestic FP production increased by 10% MoM and surged by 81% YoY. In terms of supply, most FP manufacturers raised their production schedules in March compared to February, leading to a significant boost in supply. Some companies had ample orders, operating their production lines at full capacity. Additionally, new entrants in the FP market are gradually ramping up their capacity, with production expected to continue rising in the future.

On the demand side, the market for LFP began to grow steadily in March. However, some companies saw their orders reduced by battery cell manufacturers due to pricing and project support issues, resulting in decreased orders. Meanwhile, other companies experienced a notable increase in orders, particularly those requiring externally purchased FP, driving overall demand growth.

Cost side, March was the season for spring plowing and fertilizer preparation, leading to a sharp rise in the price of industrial-grade MAP, a key raw material for ammonium-based FP production. This significantly increased production costs, prompting companies to consider price hikes in April.

In April, as the lithium battery market gradually enters its peak season, FP manufacturers are expected to further increase their production schedules, with production likely to grow by 5% MoM and 68% YoY.