Approved by the State Council, General Administration of Customs No. 74 of 2007 announced that from January 1 to December 31, 2008, the export tariff rate was adjusted for some fertilizers and raw materials for fertilizer production.
Urea: A tentative tariff of 30% will be applied from January 1 to March 31 this year, a provisional tariff of 35% will be implemented from April 1 to September 30, and will be implemented from October 1 to December 31. 25% of the tentative tariff.
Ammonium dihydrogen phosphate, ammonium dihydrogen phosphate and mixtures of ammonium dihydrogen phosphate and diammonium phosphate: Provisional tariffs of 20% from January 1 to March 31 this year, from April 1 to September 30 A tentative tariff of 30% will be imposed on the day and a tentative tariff of 20% will be imposed from October 1 to December 31.
Sulfuric acid and oleum: A tentative export tariff with a tax rate of 5%.
Urea prices will remain seasonal fluctuations
The current increase in the seasonal tariff rate for urea exports, we believe, will not result in a significant drop in urea exports next year. The main reasons are: urea prices in the international market remain high and exports are still able to obtain higher prices. Profits; exports have become an important way to become domestic excess capacity. In recent years, domestic urea production capacity has expanded rapidly. In 2006, China’s urea output exceeded 46 million tons (in kind). In 2007, China’s urea production will reach 55 million tons, an increase of 19.6%. However, the national increase in urea demand during the same period was only 5%. Therefore, exports have become a relief to domestic oversupply. The important way of the pattern.
In the fourth quarter of last year, the autumn sowing in most parts of the country had ended, and the winter storage had not yet begun. It should be the traditional off-season, but the market was not off-season and the price was soaring. Many regions reached 1,900 yuan/ton, and some areas even broke through. 2000 yuan / ton. The main reasons for this are the high level of operation of the international fertilizer market, which has led to a significant increase in exports, and the increase in energy and resource prices has increased production costs.
With strong foreign demand and high international fertilizer prices, in the wake of the off-season in 2007, under the stimulation of a reduction in export tariffs from 30% to 15%, exports have increased significantly, and urea prices have continued to climb; after mid-December, due to tariff increases As expected, nitrogen fertilizer prices began to decline slightly.
Despite strong international demand, China's urea capacity and output rank first in the world in terms of capacity, accounting for about 1/3 of the world total. In 2007, China's urea production capacity is expected to reach 55 million tons, of which, 4-30 million tons of urea will be produced from January to September, an increase of 13.96% year-on-year. In addition, the newly added capacity is only 5.6 million tons of the projects under construction and proposed to be built in 2007-2008. In 2009, the number of projects under construction announced was about 2.4 million tons. Although under the “energy-saving and emission-reduction†policy of the country, some small-scale enterprises with backward processes and poor environmental protection will face gradual closure. However, the trend of urea production capacity in China will continue to grow in the next few years, and it is expected to increase by 6%. Around, the overall production capacity will still be surplus, which also determines that urea prices will hardly continue to rise.
Therefore, considering supply and demand, cost, international environment and national policies, we insist that in 2008, urea prices will continue to exhibit seasonal fluctuations, ranging from RMB 1600 to RMB 1900 per ton, and the overall development will remain stable.
Phosphamine exports remain profitable under high tariffs
At present, a 20% levy of diammonium phosphate for the first quarter to the third quarter, and a 10% export tariff for the fourth quarter began on June 1, 2007. The purpose is also to control the export of chemical fertilizers and to give priority to guarantee the domestic market supply. However, this time The collection of temporary export tariffs did not slow down the pace of ammonium phosphate exports. On the contrary, under the favourable situation of the international price of ammonium phosphate and high prices this year, China's exports of ammonium phosphate have not only not been reduced, but have also been enhanced.
Although the upward adjustment of export tariff rates can, to a certain extent, suppress the export momentum of phosphorus amines, at present, it cannot solve the export problem fundamentally. Even if the export tariffs are even higher, if the ammonium phosphate price in the international market is considerable, enterprises will choose to export, especially for the relatively convenient Yungui and other areas where exports are still profitable.
From the perspective of capacity, the world’s largest producer of phosphate fertilizers has decreased year-on-year with the decline in reserves of phosphate rock resources. After 10 years of rapid development, China's phosphate fertilizer market has become the world's largest producer of phosphate fertilizers. In 2007, China's total phosphate fertilizer output reached 13.3 million tons. Due to the rapid increase in China's production, it is expected that in 2008 China's monoammonium phosphate, diammonium phosphate production will exceed the demand of about 6 million tons, the excess production capacity is bound to require exports to digest.
We use diammonium phosphate as an example. According to the current international average price of diammonium phosphate at US$590/tonne (FOB), the ratio of US dollar to RMB is calculated at 1:7.3. If the export tariff is levied at 20%, then the price of domestic DAP will be about RMB 3,589/ton, while the current domestic mainstream price of diammonium is about RMB 3,300-3,400/ton. Therefore, even if a 20% temporary export tariff is levied, profits will still be made for domestic DAP producers. If tariffs are levied at 30%, the price of domestic DAP will be about 3313 yuan/ton. Judging from the current situation of ammonium phosphate market, it is still higher than the production cost, but the export profits are slightly lower than domestic sales, and it is expected that the export volume will be suppressed. However, there are individual advantages, especially for companies in the Yunnan-Guizhou area, which will continue to seek exports.
From the above assumptions, under the condition that the international ammonium phosphate price maintains the current price, we believe that the scope of taxation between 20-30% is acceptable to domestic enterprises and exports are still profitable. Moreover, taking into account the international market price of ammonium phosphate is dynamic, this time China's increase in ammonium phosphate export tariff rate will have a certain impact on the international supply of phosphorus market, the international price of ammonium phosphate will continue to increase momentum, 20- The 30% tariff is also more reasonable. For the country, limiting part of the export volume, but also to protect the domestic supply of fertilizer. For some companies, to a certain extent, they can participate in international competition, so that the fertilizer market will reach a balance between basic supply and demand. The realization of the state and the enterprise will achieve a win-win situation.
Phosphate prices are still bullish
The continuous increase in the price of phosphate fertilizer is mainly supported by export pull and the rising prices of resources such as sulphur and phosphorite. Since 2007, China's exports of phosphate fertilizers have increased significantly, and domestic demand has also increased. As a result, the supply of domestic phosphate fertilizers has become tight. This gap will be difficult to fill in the short term. After the country introduces a new tariff policy, it will play a certain role in limiting the export of ammonium phosphate, but the domestic ammonium phosphate market needs to reach a balance between supply and demand, and the price of upstream resources and energy rises in a short period of time. Can not be eased, so the two factors supporting the high price of phosphine will still exist in the coming period, phosphate fertilizer prices are still bullish.
In addition, this time the country raised the export tax rate of phosphine, but also set a temporary tariff of 5% for the export of sulfuric acid and oleum. This move is also intended to limit the export of domestic sulfur, to suppress the domestic price of sulfur, to a certain extent, to reduce business cost pressures.