(March 16): China is tightening its curbs on fertiliser exports as the war in Iran disrupts trade of key crop nutrients, driving up prices globally.
The government has asked exporters to halt outbound shipments of nitrogen-potassium fertiliser blends, people familiar with the matter said. Beijing also reiterated existing export restrictions on urea, quashing traders’ hopes that a new sales quota would be issued soon, they said.
The moves are part of an effort to secure domestic supplies and stabilise prices as farmers in the agricultural powerhouse gear up for spring planting and demand peaks. China is a top consumer of fertilisers — and has been a significant exporter — but any shortage of the essential crop inputs could threaten grain security in the country.
With the latest measures, the country has effectively halted outflows of most fertiliser types, including compound varieties, said the people, who asked not to be named as they were not authorised to talk to the media. A key exception is ammonium sulphate, which made up about half of the country’s fertiliser shipments last year and is so far unaffected, they added.
China’s National Development and Reform Commission, General Administration of Customs and Ministry of Commerce didn’t immediately reply to faxes seeking comments.
The conflict in the Middle East has choked fertiliser supplies from a major production and export hub, sending prices surging worldwide. That includes China, where spot prices of urea, the most widely used nitrogen fertiliser, have jumped nearly 40% since the US-Israeli attacks in Iran began, Green Markets data shows.
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Farmers from the US to Asia and Europe have been rushing to secure supplies and lock in prices since the war’s outbreak. Indian officials also recently approached China, asking the nation to allow the sale of some urea cargoes as the war curtails the country’s gas supplies and weighs on domestic production.
China has had restrictions on urea exports for several years, using an annual quota system to control trade. Fertiliser industry groups also urged companies to halt phosphate shipments until August in a move to ensure supply, state media reported in December.
However, the country had loosened the limits on urea last year and exporters have been shipping some compound fertiliser products. Those trades are now suspended as Beijing prioritises supplies for domestic farmers, the people said.
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China also decided to release commercial stockpiles of some fertilisers early this year to ensure spring planting, the China Agricultural Means of Production Association said late on Friday.
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