[Sejong=Asia Economy Reporter Kwon Haeyoung] As the shortage crisis of urea solution originating from China spreads, the government has decided to check the domestic supply status of urea and diversify imports from third countries other than China. However, since China, which accounts for 97% of the domestic distribution volume, still restricts exports and import diversification is not easy to achieve in the short term, concerns are growing that the urea solution shortage crisis will be prolonged.
On the afternoon of the 4th, the Ministry of Trade, Industry and Energy held an emergency meeting with industries importing industrial urea at the Korea Chamber of Commerce and Industry to discuss measures to stabilize domestic urea supply. Urea solution converts nitrogen oxides into water and nitrogen and is an essential item for diesel vehicles.
This meeting was held to check the current status and seek countermeasures as domestic industries faced difficulties importing urea solution following the Chinese government's mandatory export inspection measures. The share of China in industrial urea imports expanded from 88% last year to 97% from January to September this year.
Primarily, the Ministry requested cooperation from the urea import industry to provide data for requesting the Chinese government to expedite export inspections. Through the Materials, Parts, and Equipment Supply Response Support Center, they confirmed the import contract status of the urea import industry and specific reasons for delays while requesting cooperation in providing related data.
The industry proposed government support such as providing information on overseas urea suppliers and support through overseas trade offices to diversify import sources beyond China. Since the current urea import price has risen about 3 to 4 times compared to before, they also requested relief of the industry's cost burden. As of September, the import price of industrial urea was $483, nearly double the $267 in October last year.
An official from the Ministry of Trade, Industry and Energy said, "We will continue to closely monitor the export and import trends of urea from China and other countries and persistently request cooperation from the Chinese government to ensure smooth domestic urea supply. We will also make our best efforts to support diversification of import countries." He added, "For import diversification, the Ministry of Foreign Affairs, Ministry of Trade, Industry and Energy, KOTRA, Customs Service, and related agencies will closely cooperate, and we will promptly consult with the Ministry of Economy and Finance regarding the industry's proposals." He urged the industry to actively secure urea and urea solution using the global network and strive for import diversification.
Furthermore, the Ministry plans to discover various supply sources such as third countries through overseas diplomatic missions, KOTRA trade offices, and import associations, and when confirming the supply availability of overseas companies, promote government or private purchase expansion through emergency contracts with the Public Procurement Service.
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
