Ensure Fertilizer Supply for Spring Ploughing    

The seven ministries and commissions including the National Development and Reform Commission (NDRC), the Ministry of Agriculture and the Ministry of Commerce held a conference on chemical fertilizer supply on February 26th to guarantee a stable supply and a stable price of chemical fertilizers for the spring ploughing period.
   According to officials from NDRC, it is expected the demand for chemical fertilizers for 2008 spring ploughing would be 26.6 million tons and the available amount of resources would be 27.2 million tons. Potash fertilizers need import. Phosphate fertilizer producers in southern snow-hit regions have restored production. Nitrogenous fertilizers and phosphate fertilizers in Chinese market can fully meet the domestic demand.
   The supply of chemical fertilizers in China is somewhat insufficient in some regions and with some varieties. With the impact from the price rise of chemical fertilizers and raw materials in the international market, the prices of phosphate fertilizers and potash fertilizers in Chinese market increased greatly.
   The seven administrations request large urea producers to strictly implement price policies of the state during the spring ploughing. The ex-factory price of diammonium phosphate should be up to RMB4 100 per ton. Despite the price rise of coal and imported sulfur, urea producers still have a profit margin and the production of phosphate fertilizers and phosphate compound fertilizers is also profitable at the present market price.
   To stabilize the price and ensure the market supply of chemical fertilizers, China has taken a series of specific measures. The value-added tax on imported and domestic diammonium phosphate was eliminated from January 1st to support the chemical fertilizer production. Two readjustments to the export tariff were made on January 1st, 2008 and February 15th, 2008 to reduce the export of urea, diammonium phosphate, monoammonium phosphate, phosphorus-containing compound fertilizers and sulfuric acid. Railway departments should not transport chemical fertilizers for export before the end of April. The requested slack season reserves of chemical fertilizers during 2007-2008 have increased to 10.0 million tons, putting more attention to the slack season reserves of phosphate compound fertilizers. Fertilizer producers continue to enjoy favorable prices of power, gas and railway transportation.
   The demand for fertilizers in spring ploughing period in China accounts for more than a half of the total in the whole year. The stable supply of chemical fertilizers is closely related to the stable development of agriculture and the income increase of farmers. It is an important link in maintaining the basic stability of the grain price.
   This January and February, some provinces and municipalities in southern China suffered a snow - storm seldom seen in history. Traffic was blocked and the production of fertilizer was in predicament. Moreover, with the price rise of raw materials (sulfuric acid, phosphate rock and potash) and energy, the production cost in chemical fertilizer producers went up. The average cost of urea has already reached RMB1 650-1 725 per ton, but the ceiling ex-factory price fixed by the government is RMB1 725 per ton. Nevertheless, chemical fertilizer producers must shoulder the responsibility of ensuring the supply of chemical fertilizers. They have to make full-capacity production to increase the output of chemical fertilizers.