As the largest herbicide variety in the world, Glyphosate occupies 30% of the global herbicide market share. At the beginning of 2022, after the price of Glyphosate soared to 80000 yuan/ton, with the easing of the contradiction between supply and demand, the cost of raw materials fell sharply, and the market price of Glyphosate began to lead the way down until this month's rebound.
Industry insiders generally believe that the industry destocking is the direct reason for the current Glyphosate market price rebound. Statistics show that the whole industry is expected to reduce production by nearly 30% in the first half of this year. At the beginning of July, the total inventory of domestic Glyphosate factories was 50000 tons, all of which were improved compared with the previous period. At present, overseas destocking is also very smooth, and inventory has fallen back to a reasonable level.
On the demand side, demand from Brazil, a major pesticide importer, has started, and the export volume in May has reversed the downward trend since December 2022, achieving a positive growth of 3% month on month. In addition, the price of phosphate rock is 900 yuan/ton, which still remains high and volatile. The price of raw material glycine and yellow phosphorus has risen, which has strong support for the cost of Glyphosate.
On July 6, 2023, the European Food Safety Agency (EFSA) announced the completion of the peer review of the Glyphosate re review assessment report, and issued a conclusion that no major concerns were found in the assessment of the impact of Glyphosate on human health, animals and the environment. That is, according to the current assessment results and the corresponding use scenarios, no major risks of Glyphosate that cause special concern to human health, animals and the environment have been found, so its use can be considered safe. The conclusions released by the European Food Safety Agency this time lay the foundation for the successful re assessment of Glyphosate in the European Union.
Since the application was submitted in 2019, the re evaluation of Glyphosate by the EU is the most comprehensive and transparent evaluation of a pesticide so far. Its re evaluation dossier contains over 180000 pages and 1500 scientific studies, containing information 2-4 times that of general substances. The huge review workload and its special position in the pesticide field doomed it to a long and tortuous road of re review. Now the safety evaluation of Glyphosate has finally come to an end in the EU, and the re review of Glyphosate has begun to dawn.
Next, the European Commission will analyze the conclusions of the European Food Safety Agency and the Glyphosate re evaluation report prepared by the re evaluation and assessment team, and will submit the re evaluation report and draft regulations to the Member States to recommend the extension or non extension of the approval of Glyphosate. Afterwards, representatives of EU member states will vote on the draft regulation at the Standing Committee on Plants, Animals, Food and Feed.
This is a good news for Glyphosate, and it will bring good news for the future expansion of Glyphosate use.
In the first half of the year, the Glyphosate market was depressed, and the current market situation is changing. Internationally, since July 2023, the traditional procurement peak season in South America has begun. The demand from major pesticide importing countries such as Brazil has brought an increase in foreign trade orders, and the overall inventory of the industry has significantly decreased. From October to December, demand in the northern hemisphere is driving, and exports may gradually increase.
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