【SMM】Iron phosphate cost-driven price increase expectations market in stalemate amid tug-of-war between sellers and buyers

This week, the domestic iron phosphate market continued to operate steadily, with mainstream transaction prices remaining in the 10,350-11,240 yuan/mt range. Although new order negotiations have not yet fully commenced at month-end, influenced by the continuous rise in raw material costs such as industrial-grade MAP, some mainstream producers have signaled a 100-200 yuan/mt price increase, strengthening the expectation of cost-driven price hikes.

Supply and demand structure, March market showed a balanced state of "orderly supply and restrained demand." On the supply side, mainstream enterprises maintained normal production schedules, with top-tier enterprises operating at high rates. As previous orders were continuously delivered, inventories for most iron phosphate producers have pulled back to reasonable levels. On the demand side, LFP enterprises continued their strategy of purchasing as needed, coupled with ample spot availability, downstream acceptance of price increases remained cautious.

Notably, the current market is experiencing multiple layers of competition: on one hand, the peak season for agricultural fertilizers has boosted the phosphorus chemical industry chain due to spring farming preparation, leading to tight supply of industrial-grade MAP and bullish sentiment. The regional supply of sulphuric acid remains tight, gradually passing on cost pressure to the iron phosphate segment. On the other hand, downstream LFP enterprises, affected by the extended destocking cycle of end-user power batteries, saw a slowdown in overall production schedules in March, and top-tier battery manufacturers still have price suppression demands, bringing the price negotiation between buyers and sellers into a critical window period.

Currently, purchasers are generally adopting a "price comparison" strategy, with customers imposing stricter requirements on key indicators such as product consistency and impurity content. Enterprises with scale advantages and a reputation for quality have relatively stronger bargaining power. New order negotiations at month-end may exhibit differentiated pricing, with producers having self-sufficient raw materials maintaining relatively controllable costs, while iron phosphate enterprises relying on external purchase of phosphorus sources face greater procurement pressure.

In the short term, the market is expected to maintain a relatively stable trend with a strong bias. The dynamic balance between the transmission effect of raw material costs and the downstream demand absorption capacity will dominate the price direction. If the supply of industrial-grade MAP remains tight, combined with a warming market outlook in Q2, there is still room for a 100-200 yuan/mt price increase in April. Orders between iron phosphate and LFP enterprises will gradually be placed at month-end, and the price negotiation between both parties will continue.