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Gov’t, fertilizer makers lock horns over price hikes
Fertilizer producers defended recent price surges as necessary due to higher input costs and thinning supplies, but the government says that’s all balderdash and that the price surges are irrational and damaging to farmers.
Fertilizer firms have raised their selling prices by 2-6.3 percent since early this year, and are expected to continue increasing the price over the next few weeks or months, citing the higher cost of electricity and imported materials.
However, the Ministry of Industry and Trade said there were no grounds for the hikes as power cost had only pushed industrial costs up by less than 1 percent.
Besides, the price of urea fertilizer on the world market has declined by US$1 8 per ton to some $300 per ton since mid-March, while that of DPA fertilizer has dropped by $10 to $420 per ton, said the ministry.
The ministry also said that domestic supplies of fertilizer were abundant because firms had imported large stockpiles of the product.
The country imported 948,000 tons of fertilizer in the first quarter of this year, down 15.1 percent over the same period last year, according to the General Statistics Office. Meanwhile, the demand for fertilizer in the upcoming summer-autumn crop is estimated at 650,000-700,000 tons.
Nguyen Hac Thuy, Chairman of the Vietnam Fertilizer Association, said Vietnam was not facing any kind of shortage in fertilizer. Firms imported big volumes of the material late last year before world price hikes earlier this year, he said, and thus they have no reason to be selling at such high prices.
Thuy also said firms had the ability to cut costs instead of raising their selling prices.
Tran Van Muoi, general director of fertilizer firm Nam Sao, said: “Despite higher material import costs, our selling prices have not risen because we have reserved enough material for 4-5 months of production, and we’ve tried to cut excessive costs in production and transport.”
According to the Ministry of Finance, all Vietnamese fertilizer firms gained profits last year. Some firms saw pre-tax profits to revenue ratios of 22-45 percent.
With such profits, the ministry has asked fertilizer firms to keep their selling prices stable, or even cut them, in a bid to help farmers.
The Ministry of Industry and Trade has asked relevant agencies and localities to watch over firms closely and deal with those who violate quality and price regulations.
Ngan Anh
thanhnien
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