Production of urea
1. Urea Production Capacity and Yield in China
China’s urea industry has developed rapidly. After 2010, new and expanded urea production capacity was released centrally, and urea production capacity and output increased rapidly. Urea production increased to 74.92 million tons in 2015, and the supply of urea in the whole industry exceeded the demand. Affected by supply-side reform and downstream demand after 2016, urea production continued to decline and initial results were achieved. According to the statistics of the National Bureau of Statistics, China’s urea output in 2018 was 52.067 million tons, with an output value of 107.5 billion yuan (calculated according to the average price of urea in 2018 of 2065 yuan/ton), accounting for 26.30% of the global output, and it is the largest urea producer in the world.
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2. Distribution of urea production capacity
Urea production in China is mainly concentrated in North China, Northwest China, East China and Southwest China. The main producing provinces (autonomous regions) are Henan, Shandong, Shanxi, Xinjiang and Inner Mongolia.
The distribution of urea production and production capacity in China is basically the same. In 2018, the top ten provinces (autonomous regions) in China’s urea production are Shanxi, Shandong, Inner Mongolia, Henan, Xinjiang, Hebei, Sichuan, Jiangsu, Anhui and Shaanxi. The output of ten provinces (autonomous regions) totals 43.73 million tons, accounting for 84% of the total urea production in China.
3. Concentration of urea industry
There are 123 urea production enterprises in China. There are 23 enterprises with urea production capacity of more than one million tons. The total production capacity reaches 36.16 million tons, accounting for 46.36% of the total production capacity. With the deepening of the structural adjustment of the chemical fertilizer industry, urea industry has gradually shown the trend of large-scale and group.
Urea demand
1. Overall demand
China’s urea downstream demand is divided into agricultural demand and industrial demand. Among them, agricultural demand is direct application of crops, and direct application is mainly maize, rice and other field crops. Industrial demand is mainly used in the fields of compound fertilizer, urea-formaldehyde resin, melamine, cyanuric acid, gas denitrification and fine chemical industry.
China is the largest urea consumer in the world. In 2018, China’s total industrial and agricultural consumption was 5.08 million tons, of which 3.01 million tons were consumed in agriculture, accounting for 59% and 2.86 million tons in industry, accounting for 41%.
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In recent years, China’s urea industry consumption has maintained rapid growth, and agricultural consumption has tended to stabilize. Overall, urea consumption remained stable growth until 2013. Since the 18th National Congress, the state has vigorously advocated the development of ecological agriculture, requiring the gradual control of fertilizer use. In 2015, the Ministry of Agriculture put forward the action of “zero increase of fertilizer application in 2020″ and drew up a series of action plans. The Ministry of Agriculture deepened the structural reform of agricultural supply side, adhered to the principle of promoting agriculture by quality and green, advocated the increase of fertilizer reduction and efficiency, and made the demand of urea agriculture decrease continuously, which would make the growth rate of fertilizer demand step by step. Slow down.
2. Regional Consumption
At present, the production and marketing pattern of urea in China has gradually got rid of the traditional characteristics of local production and consumption. Urea consumption is mainly concentrated in the main agricultural producing provinces in the middle and lower reaches of the Yellow River and the Yangtze River. The top ten provinces (autonomous regions) in domestic consumption are Shandong, Henan, Jiangsu, Hubei, Sichuan, Anhui, Hebei, Xinjiang, Inner Mongolia and Hunan. The total consumption of these provinces (autonomous regions) is 30.6429 million tons, accounting for 60.24% of China’s total urea consumption.
Import and export of urea
Before 1997, urea production in China could not fully meet the domestic demand, and a certain amount of urea was imported every year.
Since 1998, China’s urea production has been increasing. In order to protect the domestic fertilizer industry, the state has suspended urea imports, and urea imports have declined sharply since then. Since 2002, the State Economic and Trade Commission and the General Administration of Customs have implemented a quota system for the import of chemical fertilizers to strictly control the total amount of chemical fertilizer imports.
After 2003, China’s urea production capacity and output increased rapidly, urea export volume increased substantially, but the export volume was affected by the domestic export window period and the international urea market, which fluctuated greatly between years. The largest export volume was 13.748 million tons in 2015. After 2016, with the introduction of new international production capacity, urea supply in the international market has become more relaxed, competition has intensified, and domestic urea exports have gradually decreased due to cost disadvantages. In 2018, the total urea export volume was only 2.462 million tons, a decrease of 47.1% compared with the same period last year.
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China’s urea export ports are mainly in the north, with more than 50% of the export volume. The exporting countries are mainly large agricultural countries represented by India.