Multiple positive catalysts in resonance! Phosphate chemical sector maintains strong momentum

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Reporter Wang Xi

On March 13, the A-share phosphates sector continued its strong performance, with several concept stocks showing impressive gains. By the close of trading, Jinjingda (002470) and Luxhua Technology (600691) hit the daily limit, Chuanjinnuo (300505) rose 14.82%, Chengxing Shares (600078) increased 5.89%, and other stocks such as Chuanheng Shares (002895), Batian Shares (002170), Yuntianhua (600096), and Yuegui Shares (000833) also saw small gains.

On the news front, the phosphate fertilizer industry, closely linked to the phosphate chemical sector, experienced significant fluctuations in costs. Recently, regional geopolitical tensions have persisted, causing sulfur prices—one of the main raw materials for phosphate fertilizers—to rise rapidly. According to monitoring data from Shandong Zhuochuang Information Co., Ltd. (“Zhuochuang Information”), as of March 12, the daily average price of solid sulfur at Zhenjiang Port reached 4,630 yuan/ton, up 480 yuan/ton from before the Spring Festival, an 11.57% increase.

Zhao Xue, an analyst at Zhuochuang Information specializing in the phosphate fertilizer industry, told Securities Daily that China’s sulfur supply is generally less than demand, requiring large imports to meet domestic needs. By 2025, reliance on imports is expected to remain close to 50%. Among the sources, the Middle East accounts for as much as 56.20% of imports. Recently, threats to shipping safety in the Strait of Hormuz have raised concerns about sulfur supply domestically, boosting sellers’ willingness to hold prices and pushing up sulfur import prices, which directly increases phosphate fertilizer production costs.

On the demand side, the arrival of the spring planting season and fertilizer preparation season support positive expectations for raw material fertilizer markets. Zhao Xue noted that during spring planting, fertilizer use accounts for 45% to 50% of the annual total, and March is a critical period for traditional fertilizer preparation. As of the end of February, the operating rate of China’s compound fertilizer plants averaged 29.79%, up 3.93 percentage points from before the Spring Festival. With steadily warming temperatures, grassroots fertilizer use is gradually increasing, and distributors are more willing to restock, creating a positive demand outlook.

From the perspective of emerging demand, the growth in the new energy sector has opened new growth space for the phosphate chemical industry, especially as power and energy storage batteries drive the industry chain’s prosperity. According to Baichuan Yingfu, as of early March 2026, the market price of lithium iron phosphate (LFP) was about 55,400 yuan/ton, up 10% month-over-month. Driven by strong downstream demand for energy storage and power batteries, the demand for phosphorus-containing new energy materials such as lithium iron phosphate/lithium hexafluorophosphate has significantly increased. Coupled with ongoing efforts to reduce industry overcapacity, product prices continue to rise.

Yuan Shuai, Deputy Secretary-General of the Zhongguancun Internet of Things Industry Alliance, told Securities Daily that by 2026, as demand from the downstream new energy sector continues to grow, the resource attributes of phosphate ore will become even more prominent. The supply and demand imbalance is unlikely to be fundamentally alleviated, and overall supply and demand across the country will remain tight, with prices likely to fluctuate within a high range.

Guohai Securities analysts believe that phosphate ore, as the source of the phosphate chemical industry chain, is experiencing a historic shift from single-driven demand in traditional agriculture to a dual-driven model of “agriculture + new energy.” However, the supply of phosphate ore is constrained by slow mining progress, and supply and demand are expected to remain tight.