A series of fertilizer businesses reported increased profits by times thanks to the continuous escalation of cockroach sales

Thanks to the high selling price and good use of market opportunities, many enterprises in the fertilizer industry recorded impressive business results in the first quarter with profits increasing by twice as much as in the same period last year.

Impressive business results

In the first quarter of this year, domestic fertilizer enterprises exported a record 474,268 tons of fertilizers of all kinds, earning 307 million USD, a sharp increase of 42.2% in volume and 3 times in value. prices compared to the same period last year.

Thus, after only the first 3 months of the year, fertilizer export turnover was more than half of the export value of 559 million USD for the whole year of 2021. This impressive result was thanks to the doubling of fertilizer export prices. 2 times in the same period to an average of 647 USD/ton.

This heralds the next big year of success for fertilizer enterprises after reaping many successes in 2021.

In fact, the business picture of enterprises in the fertilizer industry such as Phu My Fertilizer, Ca Mau Fertilizer, Ha Bac Fertilizer… all recorded impressive growth in the first quarter of this year thanks to high selling prices. and make good use of market opportunities.

The most prominent is PetroVietnam Fertilizer and Chemicals Corporation (Phu My Fertilizer/PVFCCo, stock code: DPM) with net revenue of 5,829 billion dong, up 3 times over the same period last year.

DPM’s profit after tax reached VND 2,126 billion, an increase of nearly 12 times compared to the same period last year and 2 times of the plan for the whole year of 2022 (plan set at VND 945 billion). This is also DPM’s record quarterly profit.

Another big player in the fertilizer industry is Ca Mau Petroleum Fertilizer Joint Stock Company (PVCFC, stock code: DCM) with net revenue of VND4,074 billion in the first quarter, more than 2 times higher than the same period last year.

Urea sales alone is 3,769 billion dong, accounting for 88% of the total revenue structure, the high growth rate of this product mainly comes from export activities with 2,195 billion dong, 5.5 times higher than the same period last year. last.

Revenue increased sharply due to the scarcity of fertilizer supply leading to a sharp increase in domestic fertilizer prices. The average selling price of Urea TM fertilizer in the first quarter of the company increased by more than 148% compared to the same period last year.

However, the cost of goods sold only increased by 30.7% to 2,098 billion VND. Therefore, DCM’s profit after tax is estimated at VND 1,515 billion, 10 times higher than the same period in 2021 and the highest quarterly profit of DCM.

In 2022, DCM aims to reach nearly VND 9,060 billion in revenue and more than VND 513 billion in profit after tax. However, at the end of the first quarter, revenue reached 45% of the target and profit after tax exceeded the plan by 195.8%.

Notably, the profit after tax of Ha Bac Fertilizer and Chemicals Joint Stock Company (Ha Bac Fertilizer) in the first quarter reached nearly VND 868 billion while the same period lost VND 249 billion. This is a positive result for a project that was once among 12 loss-making and weak projects in the Industry and Trade industry.

According to the report, net revenue of Ha Bac Fertilizer increased by 98.3% to nearly VND 1,946 billion. Despite high revenue growth, COGS decreased by nearly 11%, so gross profit was 54 times higher than the same period last year, reaching VND 1,089 billion.

At the end of the first quarter, Ha Bac Fertilizer’s revenue reached 43.3% of the target, and pre-tax profit was 98.7 times higher than the whole year plan.

In addition to the names mentioned above, some other enterprises in the fertilizer industry also recorded high business results in the first quarter of the year such as: DAP Vinachem Joint Stock Company achieved a profit after tax of VND 136.5 billion , 3.8 times higher than the same period; Binh Dien Fertilizer Joint Stock Company, profit after tax reached 86 billion VND, up 27%…

Promising to continue to make breakthroughs in the second quarter

In the context that the global fertilizer supply is still in a tight state due to China’s export restrictions and geopolitical tensions between Russia and Ukraine, enterprises in the fertilizer industry are expected to continue to benefit from selling price in the second quarter of this year.

In April, the prices of many domestic fertilizers continued to increase in April and were 1.5-2 times higher than the same period last year, such as imported potassium at 20,000-22,000 VND/kg, DAP Dinh Vu green 61 % price of 21,500 VND/kg, Urea Phu My and Ca Mau from 17,500 to 18,000 VND/kg…

On the world market, fertilizer prices, which have increased sharply since mid-2021, have continued to rise to new highs since early 2022 after the conflict between Russia and Ukraine occurred.

The conflict has caused supply disruptions from Russia, one of the world’s top fertilizer suppliers. Meanwhile, high natural gas prices have led many producers in Europe to cut production output, raising concerns about a global fertilizer supply shortage.

As of the end of April, the prices of fertilizers on the international market are standing at their highest levels in many years with granular urea in the Middle East and Egypt fluctuating at $908-1,000/ton, up 50%. compared with the time before the conflict occurred and increased 2.6 – 2.8 times over the same period last year.

DAP price in the US also increased by 60% compared to the end of February and increased by 76% over the same period, reaching $950/ton.

In the second quarter, DCM estimated total realized revenue to reach VND 4,848 billion, pre-tax profit of VND 748 billion and profit after tax of VND 710.67 billion.

With a large demand in the second quarter, due to the target markets such as the Southwest, Southeast – Central Highlands, Cambodia in the summer-autumn crop. Besides, the selling price of domestic products is forecasted to continue to remain at a high level due to high input costs (gas prices, transportation costs, etc.).

In addition, the lack of supply of products that our country imports completely or partially, due to insufficient supply by domestic production (DAP, Kali, SA) will help the Company’s revenue to grow and complete the following tasks. financial targets in the second quarter of 2022.

Similarly, DPM expects urea price to continue to remain high in the second quarter, then decrease in the second half of the year with increased supply from China.

Although the price of input materials of NPK is increasing, but DPM has closed production materials for NPK factory in the first 6 months of 2022 and currently has the advantage of low input costs. The company expects both output and profit margin of the NPK segment to increase in 2022.

According to SSI Securities Research (SSI Research), Urea prices peaked in March and may drop sharply from June onwards as China gradually relaxes export policies and coal shortage problem is gradually overcome. .

In addition, the Government may intervene in the management of fertilizer prices in the context of low rice prices and difficult consumption of agricultural products when China restricts imports.

Recently, the Ministry of Finance proposed to the Government to unify the export tax rate of 5% for some fertilizer products to ensure domestic supply and contribute to cooling fertilizer prices.

The Ministry of Finance assessed that if the proposal is implemented, it will contribute to retaining the source of fertilizer for domestic use, especially in the context of fertilizer prices tending to increase, ensuring the harmony between the interests of the State and the Government. enterprise.