Natural gas prices will eat most of the profits of fertilizer companies. "This price adjustment associated with the residents is the highest of two fertilizer and automobile industry", China Petroleum and Chemical Industry Securities analyst Kim Bo said yesterday that price increases will significantly push up the cost of production of urea is facing the possibility of price increases. China Nitrogen Fertilizer Industry Association, according to published data, which will pay an extra Sichuan fertilizer company 500 million yuan this year.
Yesterday, the National Development and Reform Commission issued a notice that, since yesterday, natural gas prices will increase 0.23 yuan per cubic meter, which is from November 2007 to adjust the first time since the price of natural gas. Prior to this, the national price of natural gas pipelines up 0.08 yuan / cubic meters of gas from the price adjustment to increase urea production costs 0.31 yuan / square. This will allow greatly increased the cost of fertilizer production enterprises. Sichuan Mei Fung, for example, the annual gas consumption of about 4.5 to 5 billion cubic meters, the price adjustment will make it cost increase of 1 million yuan, net profit of the company in 2009 only 130 million yuan.
        China Nitrogen Fertilizer Industry Association released data show that domestic production of urea with gas from the gas consumption of about 600 to 700 cubic meters per ton, in the Sichuan region of existing capacity of 4.48 million tons of urea, 99% of the raw material for the production of natural gas (gas that is the first urea ), and only 1% of raw coal production. Florida area will be added this year in one million tons of urea production, urea production capacity in Sichuan will reach 5.48 million tons. According to 50% of the starting rate of fertilizer business in Sichuan this year will pay an extra 500 million yuan. (Guo Zhi)