4/7/2021 Financial News: Rising Prices Of Fertilizers, BPA Prices Doubled In Three Months In Communist China

1.Rising Prices of Chemical Fertilizers in Communist China

As spring ploughing is moving into full swing in Communist China, the price of chemical fertilizers has gone up significantly. The average price of the four major fertilizer varieties has increased by more than 10% from January this year. It is also higher than the same period in 2020 and 2019. For example, the prices of urea and diammonium phosphate have increased by 13% and 28% year-over-year, while the prices of potassium chloride and compound fertilizers continued to increase in March.

According to a fertilizer company in Anhui, the company’s four compound fertilizer production lines and two water-soluble fertilizer production lines have been operating at full capacity. The manager of a chemical fertilizer company in Shandong told reporters that the company is shipping 5,000 tons per day, an increase of 20% over the same period last year. It is believed that such price increases are due to the increase in domestic demand during spring ploughing and the surging demand in the international market.

2.BPA Prices Doubled in Three Months

According to industry reports, the domestic BPA (bisphenol A) price on April 2 reached 27,500 yuan/ton, an increase of 116.11% from the price of 12,725 yuan/ton on January 4. The current BPA inventory is low, and demand exceeds supply.

Many BPA manufacturers have announced shutdowns due to accidents or regular maintenance. The prices of upstream raw materials are rising. From January 4 to April 2, the prices of phenol and acetone, the raw materials for BPA production, rose by 36.64% and 34.38%, respectively. Downstream products epoxy resin and PC (polycarbonate) have also experienced substantial increases in demand and prices. The tight supply of BPA will continue, and price surges are expected to continue.

3.Used Car Prices Went Up and Transaction Volume Fell

According to data from the Communist China Automobile Dealers Association, in February 2021, 955,300 used cars were sold in the country, a decrease of 33.27% from the previous month. The total transaction amount was 59.84 billion yuan ($9.15 billion).

In addition, a recent report jointly issued by the Communist China Automobile Dealers Association and Jingzhen Estimate showed that used car prices rose in March. The value retention rate of small-sized cars increased by nearly 7%, and that of medium- and large-sized SUVs went up by nearly 6%. In contrast, the prices of sedans of major joint venture brands have plunged.

4.Price of Titanium Dioxide Increases Seven Times in Six Months

On April 6, CNNC Hua Yuan Titanium Dioxide Co.,Ltd. announced another round of price increase to its titanium dioxide due to recent market conditions and raw material price increases. The sales price for domestic customers is raised by 1,000 yuan/ton, and the export price for international customers is raised by US $150/ton.

Since October 9 last year, the company has adjusted the price of titanium dioxide seven times. According to statistics from Jiemian News, within half a year, the price of CNNC Hua Yuan Titanium Dioxide’s main product, titanium dioxide, has gone up by 5,900 yuan/ton for domestic customers and $1,010/ton for international customers. According to a source from the CNNC Hua Yuan Titanium Dioxide Securities Affairs Department, “the company previously expected that the price of titanium dioxide will continue to rise until around April this year. However, at present, the titanium dioxide market has not ended its upward trend.”

5.CCP Grocery App Dingdong Maicai Raises $700 Million

CCP online grocery app Dingdong Maicai secured $700 million of funding from investors such as DST Global and Coatue Management to fund the expansion of its business network and investment in supply chains and team building. In a previous funding round disclosed in April 2020, Dingdong raised $62 million and was valued at $1.5 billion.

Established in 2017 in Shanghai and backed by venture capitalist Sequoia Capital China, Dingdong competes with platforms operated by Alibaba Group Holding Ltd., JD.com Inc. and Pinduoduo Inc. in the country’s online grocery sector. According to Bloomberg in February, Dingdong was working with advisers on an initial public offering in the U.S. as soon as this year.

6.U.S. Dollar’s Share in Global Foreign Exchange Reserves Fell to 59%

(Reuters) – Data show that in the fourth quarter of 2020, the U.S. dollar’s share in global foreign exchange reserves fell to 59% for the third consecutive quarter, which is the lowest level since 1995. The U.S. dollar’s share in global reserves in the first three quarters of 2020 was 61.8%, 61.2% and 60.5% respectively. If such a trend continues until the end of next year, the ratio may drop to the 50% mark, and the U.S. dollar’s role as the global reserve currency may be threatened.

By 【Financial Team – Kate】
News Collection: Wendy、Kate
Proofreading: Tracy

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