According to this announcement, the total quantity of imported fertilizer quotas is 13.65 million t, shared by 3.30 million t of urea, 6.90 million t of monoammonium phosphate (MAP) and 3.45 million t of compound fertilizers.
China’s state-owned enterprises are the main consumers of fertilizers, accounting for the use of 2.97 million t of urea, 3.52 million t of MAP, and 1.76 million t of compound fertilizers.
The quota, under which the imported goods could enjoy favourable tariff for privately owned companies in China, are 330 000 t of urea, 3.38 million t of MAP, and 1.69 million t of compound fertilizers.
The tariff quotas will be distributed on a first-come, first-served basis. Therefore, the sooner companies are applying for the imports of fertilizers to China, the better the chances they will enjoy the lower duty rate. The enterprises registered with Industrial & Commercial Administrations may apply for the tariff quota within their business scopes.
In the application for chemical fertilizer import tariff quotas, an enterprise's initial quota application will depend on previous actual use of the quota, and, within the initial quantity, the enterprise may apply for Chemical Fertilizer Import Tariff Quota Certificate several times. After import or after the return of unused quota, the enterprise may re-apply for the quota within initial quota quantity.
For exporters of fertilizer to China, the system implies that Chinese companies are eager to import fertilizers early in the year. Hence, manufacturers should keep this demand in mind when offering their fertilizers to the Chinese market.
Importers that have never applied for this previously can only apply for 2000 t. The limitation for other companies, meanwhile, is between 2000 t and 500 000 t.
Import and export tariff changes in 2017
This year, export tariffs on certain goods such as nitrogen fertilizers, phosphate fertilizers and natural graphite have been eliminated. Eight varieties of goods remained under tariff quota management: a temporary tariff rate of 1% was applied to urea, compound fertilizers and ammonium hydrogen phosphates.
China’s trade regulations for fertilizers
As a member of the World Trade Organization, China is constantly decreasing its administrative barriers for trading. Consequently, all different types of enterprises, whether state-owned or private, are able to register for trading rights.
The VAT on imported goods is at a basic rate of 17% for general goods and at a lower rate of 13% for fertilizers, besides foodstuffs, grains and edible vegetable oils, gas and other energy products for domestic use, books and newspapers, magazines, and feedstuff. Foreign-invested export processing enterprises are required to pay VAT on imported raw materials, parts and components. Upon exports, the paid VAT will offset the VAT payable on the part of domestic sale goods. The excess will be rebated.