On December 24, the State General Administration of Customs issued the No. 74 announcement of 2007, which seasonally increased or imposed a large export tax rate on fertilizers and raw materials for fertilizer production.
Urea: A provisional tariff of 30% will be imposed from January 1, 2008 to March 31, and a tentative tariff of 35% will be imposed from April 1 to September 30.
Ammonium dihydrogen phosphate, ammonium dihydrogen phosphate, ammonium dihydrogen phosphate and diammonium phosphate mixture: 20% provisional tariff from January 1 to March 31, implemented from April 1 to September 30 30% of the tentative tariff.
Sulfuric acid and oleum: A tentative export tariff with a tax rate of 5%.
The purpose of this tax rate adjustment is very clear. It is to further restrict the export of high-energy-consuming and highly-polluting products, and at the same time, to ensure the supply of domestic resources and stabilize fertilizer prices by adjusting export tariffs. How does the industry reflect this tax rate adjustment? What will happen to the market next year? The conclusion reached by various companies through various accounting methods is that they may suppress exports in the short term, but in the long run, the export enthusiasm of fertilizer companies is still difficult to control.
The account of Yang Jiancheng, deputy general manager of Inner Mongolia Wulashan Chemical (Group) Co., Ltd., calculated this: After the urea tariff adjustment, the tax rate in the fourth quarter was raised by 10% from the previous quarter, which may affect China’s exports to India, the United States, and the west coast of South America. However, compared with international fertilizer prices, China is still a low-cost area. Therefore, although high tariffs are currently imposed, exports are still difficult to limit. At present, the Uri-Uni, Baltic Sea, Arabian Gulf and China urea FOB prices are all between 380 and 390 US dollars (t price, the same below). According to this price conversion, and the current domestic ex-factory price of urea 1840 yuan is basically equivalent. Therefore, there are still opportunities for exports. And from the international situation, due to the sharp rise in the prices of raw materials and energy such as oil, international urea prices will remain strong for a long period of time. Therefore, it will continue to pull China's urea exports.
Tang Liyong, deputy general manager of Sichuan Meifeng Agricultural Chemicals Co., Ltd., calculated a macro account: This year, the high prices of international fertilizers drove a large amount of domestic fertilizer exports. According to statistics, from January to November, the export volume of urea reached 3.735 million tons. It is estimated that the annual export volume will exceed 4 million tons, a record high; from January to November, the export volume of diammonium phosphate will reach 1.8 million tons. It is estimated that the annual export volume exceeds 2 million tons. At the same time, the output of monoammonium phosphate also rose sharply. From January to November, the export volume reached 1.71 million tons, far higher than last year.
Regarding the impact of the export tariff adjustment of phosphate fertilizers, Wang Qixuan, general manager of Yantai Zhongde Group Co., Ltd., has his own algorithm: This week, the price of DAP in the United States in Tampa has reached US$610. It is reported that the CPA and India have recently placed a single contract with a CIF price of 660-700 U.S. dollars. According to this price calculation, China's exports to India, shipping costs 60 US dollars, minus the export tariff, with the United States FOB price of 500 to 533 US dollars (bulk) is quite, and the current domestic price of diammonium phosphate is also basically close. However, due to the convenient export conditions of Yungui and other places, coupled with faster international settlement, fertilizer companies are still willing to export. Moreover, the increase in export tariffs has now prompted the export price of ammonium phosphate to rise: Before the export tariff was announced, the price of diammonium in China was 500 to 530 US dollars (offshore price), and now the highest price of diammonium has reached 550 US dollars, up 20 Dollars. In other words, the pressure on export tariffs has been partly passed on to foreign customers, and the export enthusiasm of enterprises will not be weakened.
Jiang Jitao, deputy general manager of Shandong Luxi Chemical's sales company, is concerned with such a set of figures: At present, the company's sulphur-to-plant price has reached 4,800 yuan, and the supply of sulphur is very short, and prices have further increased. At the same time, the price of international synthetic ammonia has reached the highest level in history. In recent days, the Gulf of Yuzhny, the Middle East, and the United States have all increased by more than US$15. The price of CIF at the port of Tampa reached 460 U.S. dollars, and it increased by 100 U.S. dollars a week. Therefore, industry insiders estimate that China's DAP export quotation will reach 580-600 US dollars (bulk). Jiang Jitao's conclusion is that urea will be operating at a high level next spring, and the price of phosphate fertilizer will continue to rise, mainly because high sulfur costs will force Chinese phosphate fertilizer prices to continue to rise.
"Although the price is so high, the supply of monoammonium and diammonium in the country will be tightened in the spring of next year," said Jiang Jitao.
Most of the companies in the interview stated that the tariff adjustment should play a role in restraining domestic fertilizer exports, increasing domestic supply, and stabilizing domestic fertilizer prices. However, as the links between the domestic and international markets are getting closer, as long as it is economically appropriate, If the international market price is higher than the domestic market price plus the export tariff, the company will have the power to export.
Urea: A provisional tariff of 30% will be imposed from January 1, 2008 to March 31, and a tentative tariff of 35% will be imposed from April 1 to September 30.
Ammonium dihydrogen phosphate, ammonium dihydrogen phosphate, ammonium dihydrogen phosphate and diammonium phosphate mixture: 20% provisional tariff from January 1 to March 31, implemented from April 1 to September 30 30% of the tentative tariff.
Sulfuric acid and oleum: A tentative export tariff with a tax rate of 5%.
The purpose of this tax rate adjustment is very clear. It is to further restrict the export of high-energy-consuming and highly-polluting products, and at the same time, to ensure the supply of domestic resources and stabilize fertilizer prices by adjusting export tariffs. How does the industry reflect this tax rate adjustment? What will happen to the market next year? The conclusion reached by various companies through various accounting methods is that they may suppress exports in the short term, but in the long run, the export enthusiasm of fertilizer companies is still difficult to control.
The account of Yang Jiancheng, deputy general manager of Inner Mongolia Wulashan Chemical (Group) Co., Ltd., calculated this: After the urea tariff adjustment, the tax rate in the fourth quarter was raised by 10% from the previous quarter, which may affect China’s exports to India, the United States, and the west coast of South America. However, compared with international fertilizer prices, China is still a low-cost area. Therefore, although high tariffs are currently imposed, exports are still difficult to limit. At present, the Uri-Uni, Baltic Sea, Arabian Gulf and China urea FOB prices are all between 380 and 390 US dollars (t price, the same below). According to this price conversion, and the current domestic ex-factory price of urea 1840 yuan is basically equivalent. Therefore, there are still opportunities for exports. And from the international situation, due to the sharp rise in the prices of raw materials and energy such as oil, international urea prices will remain strong for a long period of time. Therefore, it will continue to pull China's urea exports.
Tang Liyong, deputy general manager of Sichuan Meifeng Agricultural Chemicals Co., Ltd., calculated a macro account: This year, the high prices of international fertilizers drove a large amount of domestic fertilizer exports. According to statistics, from January to November, the export volume of urea reached 3.735 million tons. It is estimated that the annual export volume will exceed 4 million tons, a record high; from January to November, the export volume of diammonium phosphate will reach 1.8 million tons. It is estimated that the annual export volume exceeds 2 million tons. At the same time, the output of monoammonium phosphate also rose sharply. From January to November, the export volume reached 1.71 million tons, far higher than last year.
Regarding the impact of the export tariff adjustment of phosphate fertilizers, Wang Qixuan, general manager of Yantai Zhongde Group Co., Ltd., has his own algorithm: This week, the price of DAP in the United States in Tampa has reached US$610. It is reported that the CPA and India have recently placed a single contract with a CIF price of 660-700 U.S. dollars. According to this price calculation, China's exports to India, shipping costs 60 US dollars, minus the export tariff, with the United States FOB price of 500 to 533 US dollars (bulk) is quite, and the current domestic price of diammonium phosphate is also basically close. However, due to the convenient export conditions of Yungui and other places, coupled with faster international settlement, fertilizer companies are still willing to export. Moreover, the increase in export tariffs has now prompted the export price of ammonium phosphate to rise: Before the export tariff was announced, the price of diammonium in China was 500 to 530 US dollars (offshore price), and now the highest price of diammonium has reached 550 US dollars, up 20 Dollars. In other words, the pressure on export tariffs has been partly passed on to foreign customers, and the export enthusiasm of enterprises will not be weakened.
Jiang Jitao, deputy general manager of Shandong Luxi Chemical's sales company, is concerned with such a set of figures: At present, the company's sulphur-to-plant price has reached 4,800 yuan, and the supply of sulphur is very short, and prices have further increased. At the same time, the price of international synthetic ammonia has reached the highest level in history. In recent days, the Gulf of Yuzhny, the Middle East, and the United States have all increased by more than US$15. The price of CIF at the port of Tampa reached 460 U.S. dollars, and it increased by 100 U.S. dollars a week. Therefore, industry insiders estimate that China's DAP export quotation will reach 580-600 US dollars (bulk). Jiang Jitao's conclusion is that urea will be operating at a high level next spring, and the price of phosphate fertilizer will continue to rise, mainly because high sulfur costs will force Chinese phosphate fertilizer prices to continue to rise.
"Although the price is so high, the supply of monoammonium and diammonium in the country will be tightened in the spring of next year," said Jiang Jitao.
Most of the companies in the interview stated that the tariff adjustment should play a role in restraining domestic fertilizer exports, increasing domestic supply, and stabilizing domestic fertilizer prices. However, as the links between the domestic and international markets are getting closer, as long as it is economically appropriate, If the international market price is higher than the domestic market price plus the export tariff, the company will have the power to export.