According to the Vietnam Fertiliser Association, the urea price in the world’s market begins to rise. In the first week of September 2007, the urea price increased by $10-15/tonne. Vietnamese importers now try to buy urea in large quantity from China to get enough products for the deliveries in October, the prices are $260/tonne FOB for urean prill and $270/tonnes for urean granula. The supply from Baltic countries has become shorter since many plants now have to halt production for periodic maintenance.
In Vietnam, urea prices also began skyrocketing. Phu My Fertiliser Plant now sells its products at VND4,500/kg on average, while the price at the Vietnam – China border gate is reportedly at VND4,800/kg on average.
Experts all forecast that urea prices would increase further in the near future. Sources said that some producers are offering urea at $275-280/tonne FOB, but the offer has not drawn much attention of Vietnamese importers.
The locally made products are also believed to see sharp increases in prices due to the more expensive input materials. According to the Vietnam Chemicals Corporation, sulphur is now selling at $230/tonne, increasing by 50% over the previous year, while the prices of other materials have also increased by 10-20%.
The higher prices of fertilizer over the last time have been causing big difficulties for farmers.
In Hai Phong City, mass media reported that fertilizer prices have increased by four times since the beginning of the year, especially urea, super phosphorus, kali and NPK. The product of Lam Thao Super Phosphorus Plant is now wholesaling at VND1,500/kg after four times of raising prices. In fact, the price of the product may reach 2-3,000/kg after adding transport costs.
In the northern Dien Bien province, farmers now have to buy urea at VND6,500/kg, and kali at VND4,500/kg.
The higher prices of fertilizer and the short supply have caused worries about the lack of fertilizer for the upcoming winter-spring crop.
The stocks prove to be relatively low. At Lam Thao Super Phosphate Plant, the stocks are just equal to 15% of the same period of the previous year. The figures are 35% at Long Thanh Plant, and 39% at Van Dien Phosphate Fertiliser. The inventory level is very low at Ninh Binh plant (3%), and zero at Ha Bac Nitrogenous Fertiliser Plant.
In fact, the consumption level of super phosphate and NPK has seen the sharp increase this year compared to 2006, while the production cannot meet the demand due to the lack of materials. The production of super phosphate could not meet the targeted level due to the lack of acid, while phosphate fertilizer plants cannot raise their capacity due to the short supply of coal. Meanwhile, nitrogenous fertilizer plants could not raise the capacity due to the limited capacity of equipments.
Preliminary statistics showed that the urea imports in July reached 57,000 tonnes worth $14mil, representing an increase of 10.48% in quantity and 7.7% in value over the previous month, but a sharp decrease of 52% in quantity over the same period of 2006.
Vietnam has imported some 370,000 tonnes of urea in the first seven months of the year, worth $92mil, which meant the 10.62% decrease in quantity and 9.8% decrease in value compared to the same period of 2006.