Fertilizer Trading Kicks off at NCCE      

The Nanning China-ASEAN Commodity Exchange (NCCE) started spot trading of urea, diammonium phosphate, calcium magnesium phosphate, domestically-made potassium chloride and compound fertilizers on January 12th. Meanwhile, Guangxi's trading online for agricultural products, www.ncce.biz, was launched.
   This marked the first time that fertilizer products are traded on spot market via a commodity exchange in China, which would significantly help shorten the time required for distribution, lower trading costs and improve farmers' incomes. Meanwhile, it's an attempt to bring forward the state effort of making the pricing of fertilizers market-oriented and relaxing control on the distribution sector.
   Distributors now can get fertilizers directly from producers via such commodity exchange, bypassing the multi-layer wholesalers which would in turn effectively reduce farmers' spending, a trader said.
   The nation's stable tax regime and reform in the distribution system of fertilizers, among other agricultural products, in 2009 lays the foundation of the fertilizer trading on the commodity exchange. In the future, the NCCE will bank on the government plan to develop the North Bay in Guangxi province and the preferential trade policies in the China-ASEAN free trade zone, to expand online spot trading of fertilizers, grains, sugar crops, among others.
   In the first day of trading, trading volume totaled RMB617 100 for urea, RMB1.14 million for potassium chloride, RMB269 000 for calcium magnesium phosphate compound fertilizer and RMB251 800 for diammonium phosphate.
   The NCCE now only allows spot trading of fertilizers, and has yet to start futures trading.