Once local prices increased, China directed some fertiliser manufacturers to halt urea exports. This move is likely to limit supplies and raise prices for farmers in important markets like India.
According to persons acquainted with the situation. Who asked to remain anonymous because they were not authorise to speak to the media.
A government directive has caused certain significant Chinese fertiliser firms to stop signing new export agreements as of this month. They claimed that the ban only currently applies to urea.
When prices in one of the biggest grain producers in the world reached record highs. Some of China’s largest fertiliser businesses announced.
China Asks Fertilizer Makers to Halt Urea
They would temporarily halt exports in order to ensure supplies in the local market, the state planner said on Friday.
According to customs data, China is the biggest exporter of phosphate in the world. In the first half of this year.
China sold 2.4 million metric tonnes of urea and 3.2 million. Metric tonnes of diammonium phosphate fertilizer to countries like Pakistan and India.
In a statement, the National Development and China Asks Fertilizer Makers to Halt Urea Reform Commission (NDRC) said it. Had invited the fertilizer companies to a meeting to tackle hoarding and speculation. The companies were not name.
Analysts asserted, however, that they anticipated state-owned companies including Sinofert Holdings Ltd., Sinoagri Group, China National Offshore Oil Corp. (CNOOC), and China National Coal Group to be among those limiting exports.
None of the businesses responded right away to a request for comment on the matter.
The action is Beijing’s most recent response to the rising costs of important raw resources.
Due to increased international demand, decreased China Asks Fertilizer Makers to Halt Urea domestic supply. And high energy costs, fertilizer prices in China have reached all-time highs this year.
According to Gavin Ju, lead analyst for fertilizers at CRU Group, flooding in the area of China’s central Henan province has also affected production at several factories.
Since the beginning of the year, urea futures prices on China’s Zhengzhou Commodities Exchange have increased by more than a third. On Thursday, they reached all-time highs of 2,616 yuan ($405.19) a tonne before falling 2.7% on Friday.
According to China’s National Bureau of Statistics, spot urea prices were 2,814 yuan a tonne in early July, up from 2,674 yuan in June.
China Asks Fertilizer Makers to Halt Urea
The NDRC’s decision comes in response to remarks made by Premier Li Keqiang last month that highlighted the high costs of crucial agriculture inputs as a potential danger to the nation’s food security.
The NDRC announced last month that it will look into the urea market.
In order to guarantee the availability of fertilizer on the domestic market, businesses had decide to “temporarily not arrange” fertilizer exports, it was note.
Ju predicte that exports of fertilizer would start to China Asks Fertilizer Makers to Halt Urea decline in September once port inventories have been emptie.
In the coming months, “we do expect (the SOEs) to delay or reduce fertilizer exports and prioritize domestic supply, which will assist to slow the rise in domestic fertilizer prices,” said Ju.
The length of the export ban was not specified by NDRC.
1 thought on “China Asks Fertilizer Makers to Halt Urea Exports on Price Surge”