Indonesian Parliamentary Committee Agrees to Open New Urea Fertilizer Exports
With the expected excess stock in the warehouses at the 3rd level (district level), the fertilizer producers of Indonesia’s Pusri Fertilizer Holding Company urged the government to immediately provide 200,000 tons of urea fertilizer export license in the 2nd phase.
Pusri Holdings General Manager Dadang HeruKodri said in a hearing before the Sixth Committee of the National Assembly that the opening of the export channel will not affect the domestic demand for the supply of manure. Because the level 3 warehouse has enough urine and fertilizer reserves. As a result, the producer can utilize the level 3 warehouse manure reserves for export activities. Avoid overstocking.
According to Pusri’s balance sheet of urine fertilizer reserves for the year 007, the government has already issued 512,000 tons of Phase 1 export licenses for this year. However, the implementation of Phase 2 exports is too short. Producers must be ready for the 3rd stage of 723814 tons of reserves.
He said that the number of reserves is not good for the company because Pusri has to pay additional costs. Among them: the huge costs of warehouse maintenance. At the same time, on the one hand, on the world market, the price of fertilizers has turned exactly. It is about $ 294-300 per ton. “I think the country will suffer if we do not give the opportunity to export, or if we are forced to store huge amounts of reserves.”
On the balance sheet, the number of urea fertilizers evacuated to the level 3 warehouses amounts to 4.91 million tons. About 4.3 million tons of this will be transferred for the agricultural sector. And the remaining 613,814 tons as a stock until December 31.
According to the regulations of the Ministry of Agriculture, producers have to make the storage of urea fertilizer for the demand of farmers of 4.5 million tons, therefore, there are still 200,000 tons for reserve purposes.
If the government does not allow exports, he said, the accumulation of Level 1, 2 & 3 reserves plus producers’ stocks amount to 723,814 tons by the end of 2007. “This stockpile number is too much.”
However, if the government allows the export of urea fertilizer in stage 2, companies will have access to funds that can be used to rehabilitate already old fertilizer plants, with machinery and equipment that are on average more than 20 years old.
Agus Hermanto, vice chairman of the 6th Congressional Committee, said that all members of the 6th Committee are in favor of opening the export channel for Phase 2 and will propose it to the Ministry of Trade. “The condition is that producers must be able to guarantee domestic fertilizer supplies.”
On that occasion, Datang refuted the claim that there will be a strange shortage of fertilizer supply in the country after natural disasters, illegal urine fertilizer purchases or the use of fertilizers above the recommendations of the Ministry of Agriculture.