China devising new tariff policies for fertilizer exports in 2014, including possible heavy, moderate tariff cuts, respectively, in peak and slack seasons, says official; shift would help boost profitability of listed fertilizer companies

Allison Oesterle

BEIJING , November 13, 2013 (China Economic Information Service (Xinhua)) – China is formulating new tariff policies for fertilizer exports in 2014, which may cut the export tariffs, according to a report by China Securities Journal. Insiders forecast that the adjustment in fertilizer export tariff would help improve the profitability of listed fertilizer companies.

An official with the National Development and Reform Commission disclosed that China may heavily cut the fertilizer export tariffs in the peak season, and moderately adjust down phosphate fertilizer export tariffs in slack season.

Currently, China adopts a tariff rate of 5 percent on urea and diammonium phosphate during slack season, and 80 percent during the peak season from May 15 to October 15.

As China's fertilizer industry is suffering excessive production capacity, fertilizer producers maintain meager profit margins on favorable water and electricity prices and the government's subsidy on prices, said Wu Chen, secretary general of Tianjin Fertilizer Industry Association.

In 2012, China's diammonium phosphate exports stood at 3.93 million tonnes, while it came to only 2.3 million tonnes in the first nine months of 2013. Total exports of diammonium phosphate in the whole year of 2013 are expected to decline.

Insiders believed that the adjustment in fertilizer export tariff would soothe the anxiety in market. Fertilizer demand is expected to recover with price rebound in 2014. (Edited by Li Xiaohui, lixh@xinhua.org)


(c) 2013 Xinhua News Agency

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