context: Conflict in the Middle East has hit the global fertiliser trade and sent urea prices sharply higher. The PRC market looks very different: supply is ample and price rises have been mild. That rests on three strengths: self-reliance in coal-based nitrogen fertiliser, ample spare capacity, and policy support backed by commercial reserves. At the same time, Beijing is still pushing to use less fertiliser more well, helping shore up grain security.
Conflict in the Middle East has sharply disrupted the global fertiliser trade and driven one of the strongest price surges in recent years. Yet the PRC market has stayed broadly steady, with ample supply and only modest price rises. Ding Li 丁莉 Ministry of Agriculture and Rural Affairs market analysis and early warning team farm inputs chief analyst, says domestic supply is broadly sufficient, spring ploughing support has been timely, and price spillover from global markets has been limited.
The gap is stark in the price data. On 9 April, FOB prices for small-granule urea in the Middle East reached US$780 a tonne, about double the level a year earlier. In the PRC, by contrast, wholesale urea prices were about C¥1,900 a tonne, roughly one-third of the Middle East level. In phosphate fertiliser, wholesale prices for diammonium phosphate in the PRC were up about twelve percent year on year, well below the rise seen abroad.
A key reason is the PRC’s strong domestic base. Du Sen 杜森 National Agricultural Technology Extension and Service Centre chief expert, says the PRC is the world’s largest fertiliser producer, with ample capacity in nitrogen and phosphate fertiliser and rising output in potash. Most important, about eighty percent of domestic urea output comes from coal-based production. Coal is sourced mainly at home, and the equipment and know-how for coal chemicals are also domestic. That leaves the sector far less exposed to swings in global gas prices.
Data from the China Nitrogen Fertiliser Industry Association show that nitrogen fertiliser output reached 52.563 million tonnes in 2025, up 6.8 percent y-o-y, while urea output rose 7.1 percent to 72.013 million tonnes. As new plants come on stream this year, annual urea supply capacity is expected to reach 77.5 million tonnes.
A second line of defence comes from policy support and reserves. At the start of 2026, the National Development and Reform Commission, with other agencies, rolled out a notice on fertiliser supply and price stability for spring farming. It set out steps across raw materials, production, transport, reserves and trade. The state commercial fertiliser reserve scheme, now in place for 22 years, has played a buffer role. It covers nitrogen, phosphate and compound fertiliser, potash and disaster relief fertiliser. During the spring farming season, the state released more than ten million tonnes from reserves, helping smooth market swings.
Policy has also helped steady key products. In phosphate fertiliser, exports were paused during the spring farming season to give home demand first call. In potash, a large import contract for 2025 was locked in early, helping set a stable floor for the home market.