Vietnam is likely to suffer a shortage of fertilizer for the upcoming winter-spring crop as imports during the past eight months decreased while the stocks being at low levels, local experts warned.
In Jan-Aug period of 2007, Vietnam imported around 2.28 million tons of fertilizer worth US$548 million, up only 7.6 per cent on year in value but 19 per cent in value, due to higher import price.
According to the Vietnam Fertilizer Association, the urea price in the world’s market is on the rise.
In the first week of September 2007, the urea price increased by US$10-15 a ton. Vietnamese importers now try to buy a large volume urea from China to get enough products for the deliveries in October, the prices are US$260 a ton FOB for prill urea and US$270 a ton for granular urea.
Weaker supply from Baltic countries since many plants have to halt production for periodic maintenance is blamed for the growing price of fertilizer.
Meanwhile, in Vietnam, urea prices also began skyrocketing. Phu My Fertilizer Plant now sells its products at VND4,500 a kilo on average, while the price at the Vietnam – China border gate is reportedly at VND4,800 a kilo.
Experts all forecast that urea prices would increase further in the near future. Sources said that some producers are offering urea at $275-280 a ton 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 a ton, increasing by 50 per cent over the previous year, while the prices of other materials have also increased by 10-20 per cent.
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 a kilo after four times of raising prices. In fact, the price of the product may reach VND2-3,000 per kilo after adding transport costs.
In the northern Dien Bien province, farmers now have to buy urea at VND6,500 a kilo, and kali at VND4,500 a kilo.
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 per cent of the same period of the previous year. The figures are 35 per cent at Long Thanh Plant, and 39 per cent at Van Dien Phosphate Fertilizer. The inventory level is very low at Ninh Binh plant (3 per cent), and zero at Ha Bac Nitrogenous Fertilizer 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. (Market, Vietnamnet)
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