With the approval of the State Council, the Ministry of Finance, the General Administration of Customs and State Taxation Administration of The People's Republic of China issued the Notice on the Policy of Resuming the Collection of Value-added Tax on Fertilizer (Cai Shui [20 15] No.90), which stipulated that from September of 20 1 5 to September of1year, taxpayers would be uniformly charged 13% for the sales of imported fertilizers. What will happen to the price and market of compound fertilizer after the value-added tax of chemical fertilizer is restored?
Influence on the price of compound fertilizer
Influence on raw material price of compound fertilizer
Urea Taking Shandong and its surrounding areas as an example, the total cost of traditional anthracite process urea is about 1.600 yuan (ton price, the same below), but the actual ex-factory price is about 1.520 yuan, which is lower than the general cost line, so there is no problem of "value-added" here. The total cost of urea in pulverized coal gasification process of space furnace is about 1350 yuan. According to the above assumptions, the VAT is about 10 yuan. If it is passed on to the downstream, the price increase is limited. It is understood that urea production enterprises can deduct more value-added tax, so whether to resume the collection of value-added tax or not should have little impact on the current urea market.
Taking Hubei Province as an example, the ex-factory price of 55% powdered monoammonium is generally 2 100 yuan, and the total cost is about 1950 yuan, so the value-added tax needs to be paid according to 20 yuan. The mainstream ex-factory price of 64% hydrazine is about 2,700 yuan, the total cost is about 2,500 yuan, and the value-added tax receivable is about 26 yuan. According to the calculation of some diammonium enterprises, if the profit remains unchanged, it is estimated that the price of ammonium phosphate will rise by 50- 100 yuan, with an increase of only about 3%. Therefore, the resumption of value-added tax has little effect on the price of ammonium phosphate.
The cost of potash fertilizer increases the most and has the greatest impact. Since there is no input deduction, the value-added tax will greatly increase its cost, which will lead to a sharp increase in the sales price of potash fertilizer. The increased cost per ton of imported potassium chloride is about 258 yuan/ton, and the increased cost per ton of domestic potassium chloride should at least reach 150- 180 yuan/ton.
Influence on the production cost of compound fertilizer;
Recently, raw materials urea and ammonium phosphate are still in a weak state for the time being, and even their prices are still going down. Even if the value-added tax of compound fertilizer is restored, their impact on its cost should be small, and only potash fertilizer has a greater impact. Therefore, after rough calculation, it can be concluded that if the cost of potash fertilizer increases by more than 258 yuan/ton due to the resumption of VAT, the cost of 45% chlorine-based and sulfur-based general compound fertilizer will increase by at least about 64 yuan/ton. Therefore, after September 1, the quotation of compound fertilizer is likely to rise, but according to each enterprise's own situation, the range of price increase should be different. Large enterprises produce more raw materials themselves, with low production costs, large profits and more value-added tax, while small enterprises have high raw material costs, less profits and less value-added tax, but the difference should not be too great. Some enterprises are also worried that they will absorb some of the increased costs themselves due to poor market conditions or limited downstream acceptance. Therefore, after September 1, the increase of compound fertilizer quotation will mainly depend on the price trend of potash fertilizer. At the same time, we should pay close attention to the formulation of the national deduction policy and whether there is a new statement about the value-added tax in import and export.
After the first round of autumn fertilizer distribution in early August, it can be seen that the downstream dealers are not enthusiastic about making money and picking up the goods. In addition, the price of crops is low this year, and farmers are not enthusiastic about planting wheat, so they have a strong wait-and-see mood. There is still a lot of market demand before September 1. Once the news of August 10 fertilizer value-added tax is implemented, all links in the fertilizer industry will be affected to some extent. If the price of raw materials increases, the production cost of compound fertilizer production enterprises will inevitably increase, and the price of compound fertilizer will rise or become inevitable. Once the news of price increase is released, it will undoubtedly improve the current weak situation of fertilizer market in autumn, and the psychology of buying up and not buying down downstream will reappear. At the same time, in the middle and late August, the demand for the second round of fertilizer distribution in autumn will be released again, and the "good market" expected by many manufacturers will come ahead of schedule. Moreover, in order to avoid the increase of tax costs in the later period, manufacturers will inevitably introduce some discounts such as delivery subsidies, stimulate the downstream to take delivery actively, and strive to minimize the inventory of compound fertilizer products and raw materials. Therefore, before September 1, the sales peak of wheat fertilizer will come ahead of time. However, before September 1, the fertilizer demand in the downstream wheat market will be basically met, and there is only a small amount of replenishment space in the market demand after September. Therefore, the resumption of the policy of collecting value-added tax on chemical fertilizers has little impact on the current autumn market price. When the demand for chemical fertilizers is swept away in autumn and the winter storage market is started, it may have a certain impact on the overall price of compound fertilizers, and the overall price consolidation will become the main theme of enterprises. In the long run, it is inevitable that the fertilizer industry will return to market competition. The resumption of the collection of value-added tax shows the government's determination to simplify administration and decentralize power and standardize the development of the industry with the help of the market, which is conducive to the structural adjustment of the fertilizer industry, optimizing the order, eliminating the survival of the fittest, controlling the overcapacity problem, eliminating the backward production capacity with small scale and poor performance, and allowing the industry leaders with standardized operation and good performance to benefit from the integration of the market and resources. Although there are many negative effects in the short term, in the long run, while the reform brings challenges, opportunities will inevitably coexist. It is the foundation of development to seize the opportunity and innovate and optimize in the reform.