On December 24 last year, the Ministry of Finance announced the 2019 import and export tariff rules, which clearly indicated that since January 1, 2019, Fertilizer, apatite, iron ore, slag, coal tar, wood pulp and other 94 commodities no longer impose export tariffs, then for compound fertilizer,

The most significant change is the ternary fertilizer export tariff adjusted from 2018 to 100 Yuan/ton to zero tariff. Since 2016, the export tariff of compound fertilizer has fully reflected the trend of gradual loosening from the price quota to the adjustment from the quantity quota to the zero tariff, although the ternary fertilizer accounts for a relatively small amount of compound fertilizer exports, but according to China Customs Statistics, 2019 1-March,

Nitrogen, phosphorus and potassium ternary compound fertilizer accumulated exports of 191,100 tons, an increase of 640.1% yoy, such a clear increase, is bound to have a small impact on the domestic compound fertilizer market. First, to ease excess capacity. As we all know, China’s total fertilizer production capacity has long been seriously surplus, the overall utilization rate of less than 40%, the elimination of export tariffs, not only conducive to alleviating the domestic surplus of compound fertilizer production capacity, but also to a certain extent to improve the international influence of China’s compound fertilizer products, especially in the domestic market competition increasingly fierce background,

The increase of exports or will enhance the brand confidence of enterprises, through participation in international competition to enhance the quality of their own products, for the future stable development of China’s compound fertilizer market to lay a shot in the arm. Second, boost the domestic market. In the past two years, the domestic compound fertilizer market has always been in a depressed state, the production of raw materials fluctuations frequently, but compound fertilizer and agricultural products in the response is slow, enterprises themselves from upstream and downstream pressure, after the cancellation of the export of this road or domestic production enterprises another way out, but according to the current import and export market,

Export prices are much lower than import prices, blindly in exchange for low prices for sales is not a long-term solution, only enterprises take the initiative to improve product quality, there is a chance in the real international market to drive the domestic market. Finally, the export countries diversify.

It is understood that 2018 China’s ternary compound fertilizer exported to more than 70 countries and regions, including the main export destinations for Southeast Asia, such as Myanmar, Vietnam and other agricultural development-oriented countries; From the source point of view, mainly from Yunnan, Fujian, Jiangsu, Hubei and other places.

The implementation of zero tariffs in 2019 will also accelerate the promotion of ternary fertilizer exports to countries and regions along the belt and road, including China, a total of 65 such countries, with a population of 63% of the world, 29% of the world’s total economy and 35% of the world’s total foreign trade, which shows that the demand volume is very large. On the whole, the implementation of zero tariffs on exports is good for the compound fertilizer market, but because of the small base of compound fertilizer export in China, coupled with the frequent ups and downs of raw materials market and environmental protection, safety and other uncertain factors will long-term impact on the market, compound fertilizer enterprises will still face no small pressure.

A senior Iranian oil ministry official said Friday that Iran was circumventing U.S. sanctions and selling crude oil in the “grey market”.

The official news agency of the Islamic Republic of Iran quoted the Deputy Minister of oil, Amir Hussein Zamaniya, as saying that Iran “has mobilized all the resources of the country to sell crude oil in the”grey market”.

Zamaniya did not explain the meaning of “grey market” and disclose details, including crude oil exports.

Last year, the U.S. government withdrew from the comprehensive agreement on Iran’s nuclear issue and resumed sanctions against Iran, including crude oil exports, while granting eight Iranian crude oil importers a months-long exemption from sanctions. In April this year, the United States announced that the exemption would not continue after the expiration of May 1. As one of the means of “extreme pressure” on Iran, this measure aims at completely blocking Iranian crude oil exports and cutting off Iran’s main source of income.

The Iraqi side showed a non-yielding attitude and said it would continue to export crude oil. In an interview with Reuters on April 25, Iranian Foreign Minister Jawad Zarif said that “there is always a way to circumvent the sanctions” and Iran will make every effort to continue selling crude oil. Zarif refused to disclose the Iraqi side’s consideration of oil sales.

Zamaniya said on the 5th that Iraqi oil sales in the “grey market” are “not smuggling, but resistance to illegal sanctions from the United States”.

The European Union’s imports of liquefied natural gas from the United States have increased by 272% per cent year-on-day since July 2018, according to data released by the European Commission on April 30.

The data also showed that the EU and the United States had more than 1.4 billion cubic meters of liquefied natural gas trade in March this year, a record high.

The European Commission said on the same day that the European and American sides will hold the first EU-US Energy Commission high-Level forum in Brussels on May 2 to discuss further upgrading the transatlantic liquefied natural gas trade relationship. July 25, 2018, US president Trump at the White House with visiting European Commission chairman Jean-Claude Juncker held talks on bilateral economic and trade issues, the two sides agreed to strengthen strategic cooperation in the energy sector, one of the specific measures is the EU from the United States to import more liquefied natural gas.

This week’s review of the international urea market:

Influenced by Asian demand, spring demand in the United States and some European purchases, international urea prices rose this week. Urea factories in the Middle East and Egypt sell at nearly 270 US dollars per ton FOB, equivalent to 300 US dollars per ton CFR in the United States. Brazil’s market is an exception. Influenced by Iranian urea supply and payment problems, there is a gap between Brazilian urea prices and the mainstream international market.

The large demand in the urea market in India will support the international market in May and even June.

Second, this week’s international market focus:

1, India

The early announcement of urea import tenders and the extension of the window period indicate that India needs to buy a large amount of urea, and the current limited market supply may also affect its purchasing volume, prompting it to issue another round of tenders at the end of May.

2. Shortage of supply

Urea factories are increasingly digesting May supplies, and unplanned shutdowns of some urea plants in Qatar and Indonesia have also reduced market supply this month.

3. Relocation of Traders

Traders are filling short positions and have begun to turn long.

III. Trends in China’s Urea Import and Export Market

This week, urea prices in China first restrained and then rose. After the end of agricultural fertilizer use in spring, the demand for agricultural fertilizer in China was weak, and the market demand was still dominated by industry. Urea factories had to take part of orders in advance to cope with the 5.1 mini-long vacation next week. However, due to the impact of labeling and rising international urea prices, low-end domestic urea prices began to rebound on Thursday.

It is reported that a Beijing trader purchased 6,000 tons of large granular urea from a factory in Inner Mongolia at a price of US$291-293 per ton FOB. The ship was shipped to Korea in May and departed from Jinzhou Port.

According to uncertain information, a ship of 50,000 tons of Iranian urea has arrived at Zhenjiang Port and will be put into the warehouse of tax declaration for transshipment.

IV. Other urea market trends

India:

In India, MMTC issued a new round of urea import bidding, which opened on May 1 and is scheduled to ship until June 24. It is expected that MMTC will purchase at least 1 million tons of urea this time.

In fiscal year 2018-2019 (April 2018-March 2019), domestic urea sales in India reached 31.7 million tons, an increase of about 1.4 million tons compared with fiscal year 2017-2018; in fiscal year 2018-2019, domestic urea production in India reached 23.9 million tons, a decrease of about 125,000 tons compared with fiscal year 2017-2018; and in fiscal year 2018-2019, Indian urea imports amounted to about 7.45 million tons, an increase of about 1.5 million tons compared with fiscal year 2017-2018.

Egypt:

In Egypt, several new sales have taken place in the past week, as follows:

Abu Qir sold 25,000 tons of large granular urea on April 24 at a price of US$270 per ton FOB and loaded in late May.

Prior to that, Alexfert sold 10,000 tons of large granular urea at a price of $265 per ton FOB, due in May.

Last weekend, Helwan Fertilizer sold 5,000 tons of large granular urea at a price of $263 per ton FOB for May shipment.

Delta Fertilizers sells 50,000 tons of small granular urea to Midgulf and 30,000 tons of urea to ETG at a price of about $250 per ton FOB. The goods are shipped to India.

In the Middle East:

In the Middle East, the non-U.S. urea prices for May and June sold by urea factories this week ranged from $263 to $270 per ton FOB. Urea supply in Saudi Arabia and Qatar was tight. Neither Sabic nor Muntajat had any urea available in stock, nor did they plan to offer it to India for tender.

Market analysis:

Influenced by the printing standards, the international urea price has risen in an all-round way, and the situation of the market in short supply has gradually emerged. Demand in Asia and the United States is strong. At the same time, some buyers in Europe have also entered the market to purchase urea. On the supply level, the supply of urea in the Middle East is limited, and China still has no time to export urea. Despite the intention of purchasing at least 1 million tons of urea in the next round of Indian urea imports, it is expected that the procurement will be relatively difficult under the current situation of tight supply of urea in the Middle East and other regions. The international urea market will remain strong in May, supported by India’s large demand. At present, the FOB price of China’s Urea Export is still far higher than that of other regions in the world. Therefore, China’s Urea Export is still difficult. Although China’s current export is of little significance, the rising international urea price will continue to boost China’s urea market confidence.