Temporary duties on fertiliser may hurt farmers

According to the Vietnam Fertiliser Association (VFA), the prices of all kinds of fertilisers are now much higher than in early this year. For example, DAP costs US$120 per tonne, urea US$25 per tonne, ammonia US$125 per tonne and sulphur US$120 per tonne. The VFA says that the price hikes are due to limited supplies in the US, north Africa and Russia, and a shortage of reserves. There is also a increasing demand in India (up 30 percent), the US (up 20-25 percent) and Pakistan (up 12-15 percent). Together counting the country’s reserves, imports and domestic production will be just enough for the forthcoming summer-autumn crop. Nguyen Hac Thuy, the VFA’s president, says that the association has asked its member businesses to recalculate plans for raising prices. In fact, most farmers do not want to buy fertiliser due to severe weather conditions and rising prices. Many fertiliser producers and traders say that the price of fertiliser will continue to go up as input costs are higher. Tran Van Muoi, general director of the Nam Sao Fertiliser Joint Stock Company in Ho Chi Minh City says that if business can forecast the market movements it can balance prices. He adds that despite the price soaring of input materials, his company has stockpiled materials over the last 4-5 months, which will reduce production and transport costs to control prices. Meanwhile Vietnamese fertiliser businesses are not cooperating well with each other and often fail to compete with foreign partners. To iron out this…... [read more]

Nhan Dan Online - Deputy Prime Minister Hoang Trung Hai has called for greater co-ordination between relevant agencies to remove low-quality fertiliser from the market. Hai made the request at a national workshop on fertiliser quality control jointly held by the Vietnam Fertiliser Association, the Vietnamese Farmers' Union, the Ministries of Industry and Trade, Agriculture and Rural Development, and Public Security. He said market surveillance and public security agencies should step up their efforts to punish those who violate the Government decree on chemicals, fertiliser and industrial explosive materials. At the workshop, experts stated that fertiliser was essential to agricultural production but noted that quality control over this commodity remained weak, as the market was still rife with fake and inferior fertiliser. Farmer representatives told the workshop that they were unable to distinguish between counterfeit and genuine fertiliser because there are too many kinds of fertiliser available on the market. They urged the competent authorities to increase their surveillance and give clear recommendations so that farmers can know which products are appropriate for their crops.... [read more]

The Ministry of Agriculture and Rural Development estimates that the country's total demand for fertiliser will reach 10.3 million tonnes, up 700,000 tonnes compared with last year's figure. At a national seminar on the use of fertiliser in Vietnam, jointly held by the Vietnam Agriculture Science Institute and Vietnam Fertiliser Association in Can Tho City on March 5, ministry officials said the country will need 2 million tonnes of urea fertiliser. The remaining amount includes other kinds of fertiliser including kali, DAP (di-ammonium phosphate), SA (sulphate of ammonium), NPK (nitrogen, phosphorus and potassium). They estimated an import of 2.47 million tonnes, mainly SA, kali and DAP. For DAP fertiliser alone, Vietnam will import about 570,000 tonnes mainly from China. This year, Vietnam will also continue to import kali fertiliser. But that is expected to fall after the Vietnam Chemical Group's project to exploit and process Kali salt in Laos is put into operation in the next two years. According to the General Statistics Office, between 2009 and 2012, the country's total fertiliser production rose by 8.9 percent or 1 million tonnes. Fertiliser production in 2012 alone was 5.08 million tonnes, up by 8 percent compared with the figure in 2011. Thanks to increased fertiliser production capacity, imports of fertiliser have fallen significantly. In particular, in 2012, Vietnam imported about 3.74 million tonnes, worth a total of 1.6 billion USD, registering year-on-year decreases of 11.3 percent and 9.4 percent, respectively. Thanks to improved production capital, Vietnam's fertiliser exports in 2012 reached…... [read more]

Vietnam could be self-sufficient in urea fertiliser once new plants are built this year, Nguyen Hac Thuy, chairman of the Vietnam Fertiliser Association, has said. Ca Mau and Ninh Binh fertiliser plants, financed respectively by PetroVietnam and the Vietnam Chemical Group, were expected to produce 1.36 million tonnes of urea this year, bringing total production in the country to 2.36 million of tonnes - double last year's figure, Thuy said. If production reaches its target, domestic supply this year will exceed demand, estimated at 1.8 million tonnes, he said. The association also estimated urea production will rise to 3 million tonnes in 2015, far in excess of national demand and will therefore have to find new export markets. Cao Hoai Duong, PetroVietnam Fertiliser and Chemical Corp general director, said his company has been focusing on overseas trade promotion in Cambodia, Laos and Myanmar. In addition to opening a new branch in Cambodia, the company has signed a memorandum of understanding with three international urea traders, he said. Besides promoting nitrogen, phosphorous and potassium (NPK) fertiliser, which saw production rise by 61 percent last year to 127,000 tonnes, the Vietnam Chemical Group said it will continue to make further investments in expanding production by 2015. Meanwhile, the Southern Fertiliser Company plans to raise fertiliser exports by 30 percent this year, particularly to Thailand and African countries, said its director Nguyen Tan Dat. The company is also mulling a plan to export its products to Australia and New Zealand, Dat added. However,…... [read more]

With a forecast inflation rate of 18% for this year, the 5% power price hike will add burdens to people’s lives and drive up the national inflation. EVN’s price increase sends shock waves through the economy The state-owned Electricity of Vietnam Group (EVN) decided to increase power prices by 5%, to an average VND1,304/kWh, excluding value added tax, starting today, December 20. The price hike came as a shock to many people who are already struggling with rising living costs. The timing makes it especially difficult because of the upcoming Tet holiday. Many people had hoped that the price of staples, such as petrol and electricity, would be kept unchanged at least through the Tet holiday. Another reason for the surprise is that the Minister of Finance has already mentioned plans for price increases beginning next year. However, Pham Tien Thoa, Director of the Ministry of Finance’s Price Management Department, said the increase would not have much impact on inflation, as electricity price constitutes only 3% of consumer price index (CPI). On the other hand, Pham Chi Lan, an economist, stated that any power price increase would hinder efforts to curb inflation and have affect both people and businesses. The increase will be reflected in the prices of many other goods, Lan said. According to analysts, in theory the 5% power price hike would have direct impact on the CPI, but in reality it could have a psychological effect, which would cause a rise in the price of all sorts…... [read more]

Soaring global fertiliser prices and exchange rate uncertainties are tormenting Vietnam's fertiliser industry. Hanoi-based Hanexim, one of Vietnam's biggest fertiliser importers, told VIR that the world's average price since mid-October this year had soared by over 30 per cent, particularly urea fertiliser's prices which had spiked by 41 per cent. Meanwhile, the average fertiliser price in Vietnam had augmented by 10-15 per cent, against the same period last year. For example, the average fertiliser price of Phu My Fertiliser Company and Hanexim had increased by 11 and 10-15 per cent, respectively. "Not only Hanexim, but all local fertiliser producers and importers are also suffering from financial losses, based on the world's existing import prices," said Hanexim representative Pham Thi Hoa. "Hanexim does not dare to boost its imports, though the local demand is on the rise. Hanexim may gain almost no profit in 2010," Hoa said. The world's fertiliser price hikes were ascribed to China, which is among the world's largest suppliers of fertilisers, particularly urea and phosphate fertilisers and expected to continue its policy to cut fertiliser exports this year. China levies about a 7 per cent tariff on urea exports during the non-peak seasons, which run from July, 1 to September, 15 and from October, 16 to January, 31 and 110 per cent during the rest of the year, the peak season. China may advance the start of the peak season to December, 1 this year, lower the base prices for urea and diammonium phosphate, which would effectively…... [read more]

VietNamNet Bridge - The prices of various goods, both imported and domestically made, have been increasing sharply. This has worried both the producers, who fear the rise of production costs, and consumers, who fear the rise of food prices. Structural steel producers and traders are keeping a close watch on the changes in the dollar price . They say with the current dollar price, they are incurring the losses of 80,000-150,000 dong per ton, though the world steel ingot price has been stable at $580 per ton. A steel mill has revealed it would raise the sale price next week, at least by 150,000 dong per ton, in order to break even. Nguyen Van Thien, Chair of Vietnam Cement Association, said the Vietnam Cement Corporation raised the sale price by 50,000 dong per ton earlier last week, because the input material price has increased sharply due to the more expensive dollar. He said cement plants are facing big difficulties partially because of the shortage in coal supply which has made them unable to set up production plans or forced them to scale down their production. The prices of gas and fertilizer have already increased. Le Quoc Phong, Deputy Chair of the Vietnam Fertiliser Association, said the urea price has increased by one million dong per ton to 7.1-7.3 million dong, while DAP is now selling at 12 million dong per ton, a sharp increase of three million dong per ton, and kali is selling at 8.5-9 million dong (+1.5 million…... [read more]

The fertiliser industry's production capacity is likely to surpass the country's domestic demand by 1.7-2 million tonnes per year from 2010 to 2015, reported the Ministry of Agriculture and Rural Development. Both imported and domestically produced fertilisers are sold on the market in Vietnam . Therefore, domestically produced fertilisers should be exported in the future. The Vietnam Fertiliser Association said that by 2010, the domestic urea fertiliser plants produced only 920,000-980,000 tonnes—180,000 tonnes from the Ha Bac Urea Fertiliser Plant and 800,000 tonnes from the Phu My Urea Fertiliser Plant—which is lower than the domestic demand of 2 million tonnes a year. However, according to the association, from 2012 to 2015, the total domestic urea fertiliser production capacity will be 3.5 times higher than it is now, but the domestic demand will stand at 2 million tonnes per year. This increase in production is due to many new and upgraded urea fertiliser plants, such as the Ca Mau, Ninh Binh and Cong Thanh plants, set to begin operations by 2015. Currently, the PetroVietnam Fertiliser and Chemicals Corporation (PVFCCo) is exploring the export market and other industries that use urea fertiliser, such as the industry that produces melamine, the association said. Under the development plans to be carried out by 2020, Vietnam will build a fertiliser production system with state-of-the-art technologies and a distribution system. The fertiliser industry should also focus on producing high quality products for domestic agricultural production, food security and for the promotion of exports, the ministry said.…... [read more]

The control of fertiliser production and distribution systems, to be approved this month, is expected to benefit both farmers and businesses. Speaking at a conference on Oct. 12 outlining fertiliser prodution development for the next 10 years, the Deputy Minister of Industry and Trade (MIT), Nguyen Hai Nam , said fertiliser is a strategic product that helps ensure national food security. Although the Government has cooperated closely with the Vietnam Fertiliser Association in planning fertiliser production and quality, farmers are still faced with shortages and "price fever" when demand soars before planting, said Phung Ha, head of MIT's Department of Chemicals. Secretary of the association Nguyen Hac Thuy said there has been no clear development strategy for the fertiliser industry and that demand is unpredictable. According to the association, farmers lose 1.2 trillion VND (60 million USD) each year due to the low-quality and fake fertiliser products. This year, the nation's demand for fertiliser is forecast to reach 9.1 million tonnes, but domestic production can satisfy only 60 percent of this. A report from An Giang University's Economics Faculty claims farmers have to buy fertilisers at prices 30-40 percent higher than those offered by producers. They often have to buy low-quality products from small firms because State authorities can only supervise large fertiliser companies. Ha said one of the reasons fertiliser prices are often unstable was that distribution systems develop spontaneously. Products come to farmers through many middlemen. Ha said when planning is approved, fertiliser distribution systems will develop based…... [read more]

The Hanoi Times - Distributors have reasoned the VND/US$ exchange rate increase and the petrol price hike will push prices of goods up even further. Just o­ne day after the petrol price increased by 800 dong per litre to 16,300 dong o­n November 20, food retailers in HCMCity's markets have raised prices. Nguyet, a vegetable seller at Hoa Binh Market, said that the prices of vegetables have increased by 500-1,000 dong per kilo, because suppliers said they have to spend 40,000 dong more transport. Nguyen Thanh Ha, Deputy Director of Thu Duc Farm Produce and Market wholesale market, also admitted that the diesel and petrol price increases have had a big impact o­n transportation fees. This has prompted small merchants to raise prices by 200-300 dong per kilo. Meanwhile, retailers said that the dollar price increase has pushed imported food prices up by 7-10 percent and cosmetics products have also increased by 5-17 percent. Coca-Cola has raised soft drink prices by nearly 10 percent, from 132, 000 dong to 140,000 dong, while Pepsi has also raised its price by 3-5 percent. Supermarket prices have not increased yet, because they signed long-term distribution contracts. They warn that a lot of product items will increase by early December by 5-7 percent. Steel producers have also raised prices by 200,000 dong per ton to 12 million dong per ton, blaming the VND/US$ exchange rate fluctuations. Nguoi Lao Dong newspaper quoted steel mills as saying that they need to raise the sale price by…... [read more]

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