Source: Baidu        

The Measures was formulated based on the 2015 version.

In 2015, to further standardize the administration of commercial reserves of chemical fertilizers during off-seasons and to balance the whole-year supply and seasonal demand, China revised the Measures for the Administration of Commercial Reserves of Chemical Fertilizers during Off-seasons and its supplement document that were issued early in 2005.

Main chemical fertilizers that should be reserved include urea, diammonium phosphate, high-quality compound fertilizers and others approved by the NDRC and the MOF. Of these, reserves volume of urea should account for at least 40% of the total reserves in the country (by ingredient).

In 2016, restrictions are eased in general, which is expected to stimulate companies’ initiative in commercial reserves of chemical fertilizers during off-seasons. To be more specific:

1. Selection of reserves period

Enterprises are allowed to negotiate with related government departments and then choose 6 consecutive months during Sept. to the following April (eight months) as their reserves periods according to local geographic characteristics and seasonal demand for fertilizers. Comparatively, the 2015 version stipulates that the reserves period is set from Oct. to the following March (six months, not adjustable).

2. Qualifications for enterprises to undertake commercial reserves
Similar to the 2015 version:

• For circulation enterprises: average annual sales volume of chemical fertilizers in recent three years > 300,000 tonnes

• For manufacturers: sales network + average annual output of straight fertilizers > 400,000 tonnes OR that of secondary processed fertilizers > 1.20 million tonnes in recent three years

Notably, a new term is added: for enterprises in Tibet Autonomous Region, Qinghai Province and Ningxia Hui Autonomous Region, restrictions can be eased according to circumstances.

3. Term of validity of commercial reserves qualifications

Enterprises (selected through bids in principle) sign two-year entrustment agreements (vs. three-year validity term and entrustment agreements signed year by year in 2015). If they cannot continue their commercial reserves in the second year for special reasons, they should report to related government departments by the end of July that year.

The shortening of the validity term improves the flexibility of the commercial reserves of chemical fertilizers in China.

4. Examination indicators of commercial reserves ability

• In the reserves period, the cumulative volume of chemical fertilizers transferred into the targeted region ≥ reserves quota* 1.2 (vs. ≥ reserves quota * 1.4 in 2015) Note: the cumulative volume transferred = the volume of chemical fertilizers transferred into the targeted region OR the chemical fertilizers produced in the targeted region not yet put for sales

• After the reserves period within three months by the end of at least one month, chemical fertilizer inventory ≥ reserves quota(vs. ≥ reserves quota * 1.2 in 2015)

5. Responsibilities of enterprises undertaking commercial reserves

Enterprises should sell their fertilizers in stock timely to anywhere base on market demand after the reserves period while in 2015, fertilizers in inventory should only be sold within the targeted region.

6. Inspection and punishment

Enterprises have the following problems should take corresponding liabilities and are not allowed to undertake commercial reserves in the coming six years:

• Selling counterfeit or inferior fertilizers

• The content and weight of fertilizers not up to standards

Comparatively, in 2015, enterprises that commit the above problems were not allowed to undertake commercial reserves anymore.

This article comes from Phosphorus Industry China Monthly Report 1605, CCM

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Tag: fertilizers urea  diammonium phosphate

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