The depreciation of the Chinese currency, the renminbi, against the dollar, is having a big impact on nitrogen and potash fertilizer markets, analysts say. The renminbi has weakened by 9% against the dollar since the beginning of 2014 and there is talk of further depreciation, against a backdrop of China’s economic slowdown. “For the chemical industry, the strongest impact will occur for products where China is the highest-cost producer—a weaker renminbi will lower Chinese producers’ costs and therefore product prices, potentially globally, to the detriment of all producers outside of China,” says Bernstein (London) in a research note published today.
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