Potash prices, already at their lowest levels in eight years, look poised for further declines, undermined by Chinese dynamics which are not all so negative for phosphate and nitrogen nutrients, the AHDB said.
The UK-based crop bureau said that potash prices "continue to soften in most regions", hurt by "slow demand and currency volatility", with the weakness in Brazil's real, for instance, cutting the affordability of imported goods such as potash.
According to Credit Suisse, potash prices have fallen by 12% so far this year in the South East Asian market to $293 a tonne, and by 24% in Brazil to $280 a tonne.
Much of the decline has come in the past month, during which prices have dropped by 3% in South East Asia and by 5% in Brazil.
And "downward pressure [is] expected to remain a feature for the foreseeable future" for potash prices, the AHDB said, highlighted that the key granular muriate of potash product was "clearly in oversupply".
Selected fertilizer prices, and change so far this year
DAP: $408 a tonne, (-15%), FOB, Tampa
Potash: $293 a tonne, (-12%), CFR, South East Asia, standard
Potash: $280 a tonne, (-24%), CFR, Brazil, granular
Urea: $239 a tonne, (-25%), FOB, Baltic
Ammonia: $400 a tonne, (-27%), CFR, Tampa
NPK: $340 a tonne, (-7%), FOB, Baltic
Source: Credit Suisse
Meanwhile, on the demand side, the bureau noted a double whammy to hopes for orders from China from a weaker yuan, and from the reinstatement in September of a 13% VAT on fertilizer imports.
Chinese potash demand, "a sole bright spot" for the potash market for much of 2015, "should expect to feel the effects from the introduction of VAT on imports in China and from the country's currency devaluation", the AHDB said.
"China's potash demand and imports could be negatively affected."
'Could counterbalance each other'
By contrast, in the market for phosphate fertilizers - of which China is an exporter, but buys in some raw materials - the impact of the currency moves will be more mixed.
While the AHDB said that VAT increase could bring upward pressure on prices "due to higher Chinese raw material costs", the decline in the yuan "could weigh on global markets as it makes Chinese producers more competitive.
Indeed, the changes could "counterbalance each other", the bureau said, adding that they "should be watched".
Prices of diammonium phosphate (DAP), a key form of phosphate fertilizer product, have fallen by 15% so far this year in the Tampa export market, according to Credit Suisse, but prices of raw material phosphate rock are up by 7% in Morocco, the top exporter.
In the nitrogen market, the third of the big-three fertilizer sectors, urea prices, down 25% this year in the Black Sea market, may see some recovery, helped by a move by China's producers to hold prices, despite a "surplus" of nitrogen fertilizers in the country.
"In particular, there has been some intervention from the Chinese Nitrogen Fertiliser Industry Association, which has threatened penalties for traders offering product at prices lower than production costs," the AHDB said.
"Urea prices are beginning to recover gradually.
"While the upward trend in urea pricing is continuing to take hold, this will most likely be a modest recovery with only a slight increase in pricing over the fourth quarter of 2015 and into the New Year."