The Zhejiang Provincial Price Bureau issued a notice a few days ago to lift price interventions on the circulation of urea from this month. In the 10 days after the lifting of the order, the response in the industry was very dull and contrasted sharply with the strong reaction when the price intervention was introduced.
It is understood that from June 1 onwards, Zhejiang province has implemented the control of the rate of urea wholesale and retail sales, and the rate of comprehensive business operation from the factory to retail shall not exceed 7%. The sales rate for the first and second wholesale links must not exceed 2%, and the wholesale and retail link must not exceed 3%.
Wu Zhongyu, secretary general of Zhejiang Fertilizer Enterprises Association, believes that after entering the off-season, urea prices have been falling all the way. Cancellation does not cancel price intervention. It is no different for manufacturers and distributors because the current price cannot exceed the limit price. A person in charge of Zhejiang Jinfu Huidoli Agri-products Chain Co., Ltd. pointed out that the ultimate effect of urea price limit is not obvious. Although the government stipulated the ex-factory price and the overall operating margin, the price to the farmers could not be controlled after the wholesalers or retailers had changed hands, plus the costs of transportation and other miscellaneous expenses. What's more, after the government imposed a price limit, the producers did not have profit margins for lack of production, dealers were too thin to be willing to purchase goods, and farmers were too expensive to buy. This year's urea market will have a market-price phenomenon.
The relevant person in charge of the price management office of Zhejiang Provincial Price Bureau stated that although there are such reflections in the industry, the actual situation remains to be investigated. The price department will conduct a review on the implementation of price interventions by local urea business units in the near future. If it is found that there is indeed a violation of the price policy, it will be punished according to regulations. He also said that price interventions have played a positive role in stabilizing the market price of urea. Although the intervention has been lifted, it does not rule out that if there is an abnormal price next year, it will still recover or formulate new policies.
It is understood that from June 1 onwards, Zhejiang province has implemented the control of the rate of urea wholesale and retail sales, and the rate of comprehensive business operation from the factory to retail shall not exceed 7%. The sales rate for the first and second wholesale links must not exceed 2%, and the wholesale and retail link must not exceed 3%.
Wu Zhongyu, secretary general of Zhejiang Fertilizer Enterprises Association, believes that after entering the off-season, urea prices have been falling all the way. Cancellation does not cancel price intervention. It is no different for manufacturers and distributors because the current price cannot exceed the limit price. A person in charge of Zhejiang Jinfu Huidoli Agri-products Chain Co., Ltd. pointed out that the ultimate effect of urea price limit is not obvious. Although the government stipulated the ex-factory price and the overall operating margin, the price to the farmers could not be controlled after the wholesalers or retailers had changed hands, plus the costs of transportation and other miscellaneous expenses. What's more, after the government imposed a price limit, the producers did not have profit margins for lack of production, dealers were too thin to be willing to purchase goods, and farmers were too expensive to buy. This year's urea market will have a market-price phenomenon.
The relevant person in charge of the price management office of Zhejiang Provincial Price Bureau stated that although there are such reflections in the industry, the actual situation remains to be investigated. The price department will conduct a review on the implementation of price interventions by local urea business units in the near future. If it is found that there is indeed a violation of the price policy, it will be punished according to regulations. He also said that price interventions have played a positive role in stabilizing the market price of urea. Although the intervention has been lifted, it does not rule out that if there is an abnormal price next year, it will still recover or formulate new policies.
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