Fertilizer prices rise slightly

Fertilizer prices rise slightly

According to the "third-step" reform plan for natural gas prices announced by the National Development and Reform Commission on the 28th, the price of fertilizer gas will increase by 0.2 yuan per cubic meter, and will not be released along with the prices of other direct supply users. According to industry sources, China's step-by-step reform of the market price of chemical fertilizer gas will create a transitional period for the continued downturn of the fertilizer market and the upgrading of fertilizer companies in China.

The program pointed out that taking into account the actual difficulties of chemical fertilizer companies, it was decided to promote market-oriented reforms step by step and leave a certain transition period for chemical fertilizer companies. At the same time, it is required that gas-supplying enterprises increase the gas security level of chemical fertilizers, and according to the peak-sharing responsibilities assumed by chemical fertilizer companies, implement gas prices that can be interrupted, give certain preferential prices, and strive to reduce the burden on fertilizer companies.

Professor Liu Yijun, a professor at China Petroleum University and a natural gas expert, said in an interview with Xinhua News Agency that the use of chemical fertilizers has an important historical role in the development of China's natural gas industry chain, and also played an important role in local economic development and grain production. Previous natural gas price reforms were Fertilizer companies have given special policies. This reform still gives certain preferential policies to fertilizer companies. However, unlike the previous ones, this preferential policy will form a good expectation for the industrial restructuring and transformation and upgrading of fertilizer companies that suffer excess capacity, and it will also be a transitional period for chemical fertilizer companies. To a good guarantee.

It is understood that in the "first step" in 2013 and the "second step" natural gas price reform plan in 2014, fertilizer companies have enjoyed certain preferential policies. In 2013, the price of fertilizer gas was raised by only 0.25 yuan per cubic meter, which was 0.15 yuan less than that of other non-residents. In 2014, the price of 0.4 yuan was not adjusted.

However, the use of chemical fertilizers in China continues to be sluggish, and the fertilizer industry is also facing a serious overcapacity and irrational industrial structure. Taking urea as an example, according to forecast, the national urea production capacity will exceed 90 million tons this year, and the overcapacity will reach 20 million tons. However, last year China's imports of mineral fertilizers and fertilizers increased by 21% to 9.55 million tons. It can be seen that China's chemical fertilizer industry suffers from excess production capacity on the one hand, and on the other hand, imports are greatly increased due to irrational product structure, which is not conducive to China's chemical fertilizer supply security.

The plan also clearly pointed out that lower prices for the use of chemical fertilizers will help ease the pressure of rising fertilizer costs, but it is objectively not conducive to promoting the transformation and upgrading of fertilizer companies, to resolve the contradiction of overcapacity in the fertilizer industry. Looking from the direction of reform, the price of fertilizer gas will eventually be released by the market.

Liu Yijun said that in the long run, the price of chemical fertilizer gas needs to be marketized, which will help China's fertilizer industry to shut down backward production capacity and upgrade its industrial structure. However, in the near future, due to the downturn in the fertilizer industry and the difficulty in channeling gas prices, Accumulation of industrial upgrading is also insufficient, and fertilizer companies still need a transition period. However, in order to ensure domestic fertilizer production, in the future, as the price of fertilizer gas continues to rise, it may be considered to introduce a better fiscal and financial support policy for the fertilizer industry.

Although the price of fertilizer gas was not adjusted in 2014, due to factors such as overcapacity and rising raw material costs, the gas-to-liquid fertilizer enterprises had been in crisis after adjusting prices in July 2013. Last year, many large-scale gas fertilizer companies such as Chitianhua, Lutianhua, Sichuan Chuanhua and Sichuan Meifeng were fully involved in losses, and their gas consumption dropped substantially.

Jiang Runyu, a researcher at the Institute of Macroeconomics of the National Development and Reform Commission, said in an interview with Xinhua News Agency that the slight increase in chemical fertilizer prices will affect the fertilizer industry to a certain extent, but it will speed up the process of transformation and upgrading of the industry, and it will not be as a whole. Affect China's fertilizer production and supply. However, taking into account the needs of agricultural production and China's huge grain demand, fertilizer production needs to be ensured. In the future, with the liberalization of the price of fertilizer gas, China needs to introduce relevant policies to support fertilizer companies, such as subsidies for high-end fertilizer production.

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