Inspiration from the five-year cycle of glyphosate

During the “Eleventh Five-Year Plan” period, the glyphosate industry, which experienced price “roller coaster” changes, is gradually reflecting on rationality after the price has returned to the starting point of 20,000 yuan/ton. The enlightenment it brings us and the rational and orderly development path we are exploring also applies to many other industries.

In 2006, the sales price of glyphosate started from around 20,000 yuan per ton and continued to soar. This is because at the beginning of the “11th Five-Year Plan”, the large-scale planting of genetically modified soybeans, corn and other crops increased the global demand for glyphosate, and Monsanto, the world's largest glyphosate manufacturer, gave up on glyphosate at the end of 2006. The expansion of production input has caused the global glyphosate market to be unsatisfied. China became the largest exporter of glyphosate and ushered in a golden age of development. By 2008, its export price once exceeded the 100,000 yuan per ton mark.

The out-of-control selling price triggered a frenzy of new construction and expansion in the industry, and extra-capital capital was added to the team that shared this seductive cake. The whole industry is full of joy and is totally behind the danger. With the outbreak of the financial crisis, the price of glyphosate was forced to “lower” in the second half of 2008. As the "big-construction project" has already formed a serious surplus, companies have cut production and stopped production.

Now, glyphosate is back to prices in 2006. After this round of reincarnation, our gain is that the entire industry gradually becomes more rational.

Since 2009, domestic leading glyphosate manufacturers have accelerated technological progress and management advancement, intensively conducted cost control, significantly reduced production costs, and have obvious advantages in competition with foreign counterparts. At the same time, the suspension of production of SMEs has led to the concentration of production capacity to cost-intensive enterprises and the pace of industry consolidation has further accelerated. The ever-increasing environmental protection, energy-saving and emission reduction requirements in the country have gradually raised the industry's threshold for entry, allowing backward production capacity to gradually withdraw. The overall quality of the industry is improving and the market order is improving.

The huge and stable market demand will bring favorable development prospects to advantageous enterprises, and the industry will embark on the path of scientific development. This is exactly the result of the wave breaking of the glyphosate industry. It should also allow the oil and chemical industry to think hard.