Government: “There will be no supply and demand problems until the end of this year”
Industrial dependence remains high at 90%
Chinese authorities deny total export restrictions
▲ Urea water is on display at a large supermarket in Seoul on the 10th amid concerns of a second urea water crisis as foreign media reports that Chinese authorities are restricting exports of urea for fertilizer. Newsis As foreign media reports that China has halted urea exports from domestic fertilizer companies, concerns are growing that the ‘urea crisis’ that caused long waiting lines at gas stations across the country two years ago could be repeated. As consumer anxiety continued, with urea water being sold out day after day on online sales sites, the government took steps to address the issue by explaining that it was at a level that could be responded to through stockpiling.
On the 10th, ‘temporarily out of stock’ messages appeared one after another on domestic vehicle urea water sales sites. On the purchasing site of Lotte Fine Chemical, a representative urea solution seller, a notice appeared saying, ‘Product currently discontinued.’ In online truck communities and car clubs, posts expressing concern about a second urea crisis were posted in real time, such as “I ordered 100 cans at a gas station today,” and “The urea water I ordered yesterday was posted as delayed in delivery, and the price also went up.”
The government emphasized that there is no shortage of domestically available elements. The Ministry of Trade, Industry and Energy said on the 8th, “After the 2021 urea incident, the government is stockpiling urea inventory for vehicles through the public stockpile project, and private companies are maintaining appropriate stocks in the country for each company,” adding, “Imports from Southeast Asia, the Middle East, etc. “We also have alternative ships, so even if a supply chain crisis occurs (from China), we are expected to be able to sufficiently respond,” he said.
The inventory of urea water for vehicles that the Ministry of Trade, Industry and Energy has determined to be currently in stock in the country is about two months’ worth, and considering all the quantities scheduled to be introduced, the government believes that there will be no problems with supply and demand by the end of this year. As 51% of urea for fertilizers is imported from Qatar and Saudi Arabia, it is expected that there will be no problems with supply and demand.
However, some say that it was a policy mistake that dependence on factor imports from China remained high despite the crisis two years ago. Dependence on China for industrial elements decreased from 83.4% in 2021 at the time of the crisis to 71.7% last year, but rebounded to 90.2% in the first half of this year. In addition to urea, China’s export restriction policy for rare minerals such as gallium and germanium, core semiconductor materials, is being implemented intermittently, leading to the need to diversify the supply chain by mineral and material.
Meanwhile, there has been no significant response from China to reports about the ban on urea exports. On the 9th, online media He Xun Wang cited a Korean media report and denied a Bloomberg News article that said, “The Chinese government ordered fertilizer companies to stop exporting urea.”
The media reported that right after the report, a Korean government official had a working-level hotline contact with China, where China responded, “We have not introduced a complete restriction on urea exports.”
Reporter Kwak So-young in Seoul and Correspondent Ryu Ji-young in Beijing
2023-09-10 09:30:12
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