China eases urea export ban, but not for India

China is loosening its ban on urea exports, a move likely to ease surging international prices that have been buoyed by tension in the West Asia.

Limits on exports of the fertilizer will be loosened from this month, according to people familiar with matter. However, Chinese companies will still be subject to quotas and, in some instances, minimum prices for shipments, said the people, who asked not to be named as they're not authorized to talk to the media. Exports to India will still be restricted, they said.

China's ministry of commerce didn't immediately reply to a fax seeking comment.

Urea, the world's most commonly used nitrogen fertilizer, provides one of the essential nutrients that underpin global food production. As recently as 2023, China was the world's biggest exporter of urea, but a ban on overseas shipments was put in place last June to cut domestic prices to aid farmers and bolster food security.

So far, the quota for urea exports has been set at about 2 million tons for the near term, according to Gavin Ju, an analyst at CRU Group in Beijing.

"The original intent of the policy was to secure domestic supplies and stabilize prices at a level that farmers could afford," he said. "Local prices have remained within a reasonable range. So taking into consideration affordability for farmers and profits for urea companies, it makes sense to loosen controls on exports."

Urea prices in Shandong, a top producing province, fell to the lowest in more than seven years in Jan and have remained subdued since then.


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