Preventing a Second Urea Shortage... Stabilizing Vehicle Urea Supply with '50% Subsidy on Price Difference'

Prepared Crisis Response Action Plan for Inspection of Over 50 Economic Security Items

The government will designate about 50 economic security items that have high dependence on specific countries and significant economic impact, and prepare a crisis response action plan that can be immediately applied in case of supply instability. Starting next year, it will subsidize 50% of the price difference for urea imported from third countries other than China.

On the 16th, the Ministry of Economy and Finance announced this at the '2nd Supply Chain Stabilization Committee' held at the Government Seoul Office, chaired by Deputy Prime Minister and Minister of Economy and Finance Choi Sang-mok. The committee, established under the Supply Chain Stabilization Act, serves as a government-wide control tower for supply chain stabilization policies and was held for the second time following the first meeting in June.

In his opening remarks, Deputy Prime Minister Choi said, "Recent escalations in the Middle East conflict, the European Union's imposition of countervailing duties on Chinese electric vehicles, and the upcoming U.S. presidential election have heightened uncertainties surrounding our economic security and supply chains," adding, "Since uncertainty and anxiety are the biggest factors hindering economic actors' willingness to engage in economic activities, we will actively engage in pre-inspection, early warning, and proactive response to supply chain risks."

The government will review preparedness for potential supply instability of about 50 items with high dependence on specific countries and significant economic impact, selected from the approximately 300 economic security items designated at the first meeting, and based on this, will prepare a crisis response action plan.

To prevent a second urea crisis, starting next year, the government will subsidize 50% of the price difference for long-term contracts for urea imports from third countries other than China, and will promote the extension of tariff quota application, strengthening support for import diversification. Additionally, measures such as expanding public stockpiles and supporting domestic production for fundamental supply stabilization of automotive urea will be announced in the first quarter of next year.

A total of 84 companies were selected as leading businesses contributing to the production and introduction of economic security items. Deputy Prime Minister Choi stated, "We will continuously select additional leading businesses by ministry and provide timely support from the 5 trillion won-scale Supply Chain Stabilization Fund."

Last month, the Supply Chain Fund approved loans totaling 152 billion won to four companies, and successfully issued 190 billion won in fund bonds earlier this month. In addition to loans and guarantees, the Supply Chain Fund is creating a specialized private equity fund worth 1 trillion won in the supply chain sector, and plans to expand the fund to 10 trillion won next year.