Fertilizer production and sales are caught in a "dilemma"
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However, due to the impact of factors such as rising raw material prices, coupled with the intense transportation during the Spring Festival this year and the obstruction of traffic caused by the snow and ice disasters, fertilizer companies are faced with the government’s policy of strict price control. They are in a dilemma: no production or less production, which will certainly occur after the start of spring farming. Fertilizers are in short supply; at full capacity, high prices for raw materials and low prices for products will cause losses.
In order to ensure the supply of chemical fertilizers in spring and stabilize fertilizer prices, the National Development and Reform Commission issued a notice before the Spring Festival, reaffirming that all localities must conscientiously implement various preferential price policies for the production and circulation of chemical fertilizers, and continue to organize well the production of electricity for fertilizers and the use of gas; Departments should strengthen price supervision in the production and distribution of fertilizers; severely investigate and punish fertiliser producers for failing to implement government-guided prices, sales exceeding the ceiling price of fertilizers, and failing to comply with price-raising and price adjustment filings. Recently, after the country raised the provisional tariff for some fertilizer exports at the end of last year, it once again raised the provisional tariff for exports of diammonium phosphate and monoammonium phosphate in the first three quarters of 2008 to 35%, and also imposed a 35 percent export of compound fertilizers. % of export tariffs. In the face of the continuous increase in the price of fertilizers in the international market, the state has continuously raised the tax rate for fertilizer exports. The intention is very obvious. It is to strictly limit the export of chemical fertilizers and ensure the demand in the domestic market.
The National Development and Reform Commission and the China Nitrogen Fertilizer Industry Association in Beijing held a proposal for the implementation of a strict implementation of chemical fertilizer price policies attended by more than 30 large and medium-sized nitrogen fertilizer production enterprises in Beijing. They issued a proposal to “conscientiously implement the fertilizer price policy and effectively ensure the stable price of chemical fertilizersâ€. Advocating that all fertilizer manufacturers should take the overall interests of farmers' interests into consideration, actively develop production, conscientiously control exports, and ensure the supply of chemical fertilizers in the domestic market. Strict implementation of the state's policy on fertilizer prices does not exceed the state's maximum chemical fertilizer prices, and it does not raise the burden. Fertilizer prices, unchanged in price, contributed to maintaining price stability in the fertilizer market. The person in charge of the China Phosphate Fertilizer Industry Association also stated that manufacturers of phosphate and compound fertilizers should deeply understand the significance of the central government stabilizing fertilizer prices and safeguarding major supplies of supply, adopt various active and effective measures to overcome various difficulties, and maximize the costs of digesting costs. Factors, striving for stable production, high yield, high quality and low price fertilizer supply market, to meet the needs of spring farming and the use of fertilizer throughout the year. The Phosphate Fertilizer Association hopes that phosphate and compound fertilizer companies will have to shoulder social responsibility.
The state has once again stepped up its strict control over the prices of chemical fertilizers, mainly due to the increase in exports since the autumn of last year and the reduction in domestic market resources, as well as the significant increase in domestic fertilizer prices. The main reason for the price increase in the domestic fertilizer market is the increase in raw material prices. Due to the price hike in domestic coal prices, the supply of natural gas that is tight and the preferential price for natural gas cannot be guaranteed. The price of imported sulphur and potassium chloride has skyrocketed, which has made it difficult for fertilizer companies to offset the increase in cost through self-digestion. Adjust the ex-factory price to maintain production.
The fertilizer companies that have been trapped in the state’s stringent control policies, rising raw material prices, and difficulties in sales have faced pressure from snow and ice in 2008. Due to the large regional differences in China's fertilizer production and consumption, especially the disconnection of production and sales of ammonium phosphate, the spring transportation coupled with ice and snow disasters caused the traffic to be blocked. Raw materials could not be transported in and products could not be shipped out, not only affecting the normal production of enterprises in the affected areas, but also The normal production and circulation of chemical fertilizers in some non-affected areas have become passive. It is understood that due to the impact of electricity and transportation, fertilizer companies in the affected provinces in the south have reduced their production and production. Due to water blackouts in Guizhou, most of the phosphate fertilizer companies were shut down before and after the Spring Festival; the production of phosphate fertilizers in Yunnan was also affected; Sichuan was affected by limited power disturbances and raw materials, and the phosphate fertilizer manufacturers stopped production and overhaul; and the northern nitrogen fertilizer production enterprises Also faced with difficulties such as electricity and coal supply. Therefore, although the snowstorm in the south is regional this year, the impact it brings is nationwide.
The sharp increase in domestic market prices of various chemical fertilizers and the experience of the implementation of state price supervision work in previous years have affected the current purchase enthusiasm of fertilizer distributors. Dealers believe that this year's fertilizer prices are too high to dare to enter new goods. In the event that the state's regulation and control efforts are in place, the price of chemical fertilizers will drop, and they will lose. Seeing the spring planting approaching, most of the dealers who did not purchase still wait and see due to the huge market changes.
Fertilizer prices have risen so fast this year that many manufacturing companies and distributors have fallen into the dilemma of "want to produce without dare and conditions for large-scale production," and "want to store but do not dare to store." At present, many experts in the industry believe that given the current situation, it will be difficult to change the situation of maintaining high fertilizer prices during the period of spring plowing this year. In particular, the prices of phosphorus and compound fertilizers which are subject to substantial increases in raw material prices will be very difficult for the government to curb.
As the ultimate consumer of fertilizers, the majority of farmers have become the ultimate bearers of price pressures. Manufacturers can adjust their own operating activities according to the needs of the farmers in terms of how much the farmers need to calculate their profits in the event that their profit margins are repeatedly compressed due to rising raw materials; With chemical fertilizers, prices will have to be higher. In frustration, farmers can only respond by buying less, buying less, or buying cheap ones. On the positive level, this may create conditions for the scientific use of chemical fertilizers. The majority of agricultural technicians should make use of this opportunity to push forward the work of soil testing and formula fertilization.