China loosens export of phosphate fertilizer

Keyword: Phosphorus ore, Yellow phosphorus, Phosphate fertilizer, Phosphate chemicals
Publish time: 15th January, 2013      Source: CCM
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  On Dec.17, 2012, China’s Customs Tariff Commission of the State Council (CTCSC) promulgated the export tariff of 2013. In accordance with the new export tariff, China is to loosen the export policy on phosphate fertilizer (including ammonium phosphate (DAP & MAP) and triple superphosphate). The new export tariff will take effect on Jan.1, 2013, according to CCM’s latest report, Phosphorus Industry China Monthly Report 1301 issued on Jan.15, 2013.
  Compared with the corresponding export tariff in 2012, the new export policy of DAP and MAP highlighted the following points:
  —lowering the export tariff, especially during peak season;
  —prolonging the export period for low export tariff from four months to five months;
  —raising the export trigger price.
  The loosened export policy on phosphate fertilizer mainly resulted from an air of depression spreading across China’s phosphate fertilizer market in 2012.
  In H1 2012, most listed phosphate fertilizer companies saw a decline in profit margin of DAP and MAP. For instance, Anhui Liuguo Chemical Industry Stock Co., Ltd. (Liuguo Chemical)’s profit margin in DAP dropped from 14.52% in H1 2011 to 5.25% in H1 2012. Like Liuguo Chemical, Hubei Yihua Chemical Industry Co., LTD. (Hubei Yihua) also saw a 37.12% year-on-year decline in profit margin of DAP in H1 2012.
  In H2 2012, China’s poor export performance in phosphate fertilizer casted another shadow over domestic phosphate fertilizer firms.
  In general, both in short run and long run, the loosened export policy is bound to benefit China’s phosphate fertilizer market.
  In the short term, China’s export tariff adjustment for phosphate fertilizer shored up the confidence of phosphate fertilizer firms and reversed the falling price for phosphate fertilizer. According to the data from China National Agricultural Means of Production Circulation Association, China’s wholesale price index for DAP (CPPI) immediately bounced off the lows in one week after the release of the new export policy on Dec.17.
  In the long term, China’s phosphate fertilizer firms would be motivated to export DAP and MAP in the high-tariff period of 2013 due to the reduction in cost of export. Nonetheless, the real export situation of phosphate fertilizer still depends on international market.
  Table contents of Phosphorus Industry China Monthly Report 1301:
  Headlines of Phosphorus Industry China Monthly Report 1301
  Annual Review of Phosphate Industry in 2012     
  Top five phosphorus industry events in 2012    
  Comparison between China’s prime phosphorus enterprises
  Kailin Group completes construction of MDCP project     
  Hubei Xingfa to continue phosphate projects despite Dequest quits   
  Yichang City reminds local phosphorus industry to orderly develop
  China’s phosphoric acid industry expected to see reshuffle    
  China loosens export of phosphate fertilizer    
  Anti-dumping keeps plaguing types of China’s phosphate salts    
  Africa’s phosphate fertilizer industry show alluring prospect   
  International trade of phosphate chemicals in Nov. 2012   
  Price monitoring of some phosphate chemicals in 2012
  Phosphorus Industry China Monthly Report, issued by CCM on 15th every month, keeps providing the latest company dynamics related to China’s phosphorus industry, and market analysis on supply and demand, import and export as well as global insight.
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