CICC released a research report stating that according to Baiichuan Information, potassium chloride Vancouver/Baltic FOB quotations are $288/290 per ton respectively, up 24%/35% compared to the beginning of the year; domestic Qinghai Salt Lake ex-factory quotation is 2,800 yuan/ton, up 10% compared to the beginning of the year. Since 2025, potash prosperity has continued to rise. With limited new industry capacity in 2025-26 and low domestic inventory levels, this round of high potash prosperity may have relatively long sustainability. The firm recommends paying attention to the performance elasticity it brings to listed companies and is bullish on Qinghai Yanhu Industry Co.,Ltd. (000792.SZ); under high potash prosperity, the construction progress of new capacity is expected to accelerate.
CICC's main viewpoints are as follows:
**Global Potash Prices Rise in 2025 Due to Production Cuts and Tariff Disruptions**
According to Baiichuan Information, potassium chloride Vancouver/Baltic FOB quotations are $288/290 per ton respectively, up 24%/35% compared to the beginning of the year; domestic Qinghai Salt Lake ex-factory quotation is 2,800 yuan/ton, up 10% compared to the beginning of the year. CICC believes this is mainly driven by the following reasons: 1) In 1H25, both Belarus and Russian potash companies carried out production cuts, while potash capacity affected by the Russia-Ukraine conflict has basically returned to normal by the end of 2024, and the impact of this incremental supply on the market is marginally weakening. 2) Since February 2025, the U.S. import tariff policy on Canadian potash has changed multiple times, leading to volatile increases in overseas prices.
**Supply and Demand Still Relatively Tight, BHP Potash Project Production Delayed**
Demand side: According to Nutrien's announcement, potash prices are still relatively acceptable to downstream users compared to 2022-23. Nutrien raised its full-year demand forecast to 73-75 million tons, mainly considering that potash demand has returned to a growth trend, potash contracts with India and China have been successfully reached, and the economic benefits of major crop cultivation in Southeast Asia have performed well. Nutrien expects this will provide support for 2H25 potash demand.
Supply side: Global new capacity is limited in 2025, supply and demand are tight, and BHP's potash project has been delayed to mid-2027.
**Port Inventory Drops to 1.63 Million Tons, Potash Peak Season Not Yet Over, Bullish on Price Prosperity Maintenance in Second Half**
According to JoyData Information, current port inventory is 1.63 million tons, the lowest level since 2021. From the seasonality of downstream demand, potash demand can generally continue until October, and the firm is bullish on continued price prosperity.
**Risk Factors**
Changes in overseas potash capacity tax policies, new capacity launch leading to potash price decline.
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