The State Council has announced a target of reducing the use of chemical fertilizers and pesticides! New‑type fertilizers are poised for a boom.

Release Date:

2018-07-07

　　On June 27, the State Council issued a notice on the Three-Year Action Plan for Winning the Battle to Protect Blue Skies. The notice calls for prioritizing key regions—including the Beijing–Tianjin–Hebei area and its surrounding regions, the Yangtze River Delta, and the Fenwei Plain—to continuously implement measures to prevent and control air pollution; vigorously adjust and optimize industrial, energy, transportation, and land-use structures; strengthen regional joint prevention and control; intensify efforts to address pollution during the autumn and winter seasons; and resolutely win the battle to protect blue skies, thereby achieving win‑win outcomes in environmental, economic, and social terms.
　　Notably, the notice includes measures such as accelerating the relocation, upgrading, or closure of heavily polluting enterprises in built-up urban areas, prioritizing reductions in non‑power‑sector coal consumption, and substantially increasing the share of freight transported by rail—actions that will have far-reaching implications for the agrochemical industry. The notice also makes its first-ever mention of… Fertilizer Pesticide Negative growth in usage is a reflection of the traditional… Fertilizer Modified and enhanced, improved Fertilizer One of the key measures to boost utilization rates is that new types of fertilizers, such as humic acid–based and seaweed‑based fertilizers, are poised for a boom!
　　The following is a compilation, prepared by Nongcai.com’s Agrochemical Encyclopedia, of selected content related to the agrochemical industry:
　　I. Strengthen efforts to adjust the regional industrial layout.
　　Accelerate the relocation, upgrading, or closure of heavily polluting enterprises in built-up urban areas, and advance a number of relocation projects for such enterprises in sectors as cement, flat glass, coking, and chemicals. In key regions, urban steel enterprises must earnestly adopt measures—including complete shutdowns, industrial transformation, on-site upgrades, and off-site relocations—to drive structural adjustment and upgrading. The establishment of new chemical industrial parks is prohibited in key regions, and efforts to rectify existing ones will be intensified. For enterprises already slated for relocation out of urban areas, clear timelines must be set; those failing to relocate by the deadline will be ordered to suspend production. (The Ministry of Industry and Information Technology, the National Development and Reform Commission, the Ministry of Ecology and Environment, and other relevant departments shall assume responsibilities according to their respective mandates.)
　　Analysis: Overall, agrochemical enterprises still face challenges such as product homogenization and low-end positioning, irrational industrial layout, acute safety and environmental concerns, and an underdeveloped system of independent innovation. This policy will help phase out outdated production capacity in the agrochemical sector, fostering the industry’s transformation and upgrading toward the mid- to high‑end segments.
　　II. Deepening Industrial Pollution Control
　　Continue to promote the full compliance of industrial pollution sources with emission standards, use online flue‑gas monitoring data as the basis for enforcement, and strengthen penalties for exceeding standards and implement joint punitive measures. Enterprises that fail to meet emission standards shall, in accordance with the law, suspend production for rectification. Establish an enterprise emissions permitting system covering all stationary pollution sources, and by the end of 2020, complete the issuance of permits for industries specified in the National Catalogue of Pollutant Discharge Permit Management. (Responsible: Ministry of Ecology and Environment)
　　Promote the upgrading and transformation of pollution control in key industries. In priority regions, sulfur dioxide, nitrogen oxides, particulate matter, and volatile organic compounds (VOCs) shall fully comply with the special emission limits for air pollutants.
　　Interpretation: Vigorously promoting clean production among enterprises will be a key priority for the relevant authorities going forward. Conducting concentrated remediation efforts in development zones, industrial parks, high-tech zones, and similar areas will significantly improve ambient air quality. For agrochemical companies, investing in additional pollutant‑treatment equipment and upgrading production processes will entail substantial costs. However, from another perspective, clean production can also greatly enhance a company’s reputation and facilitate the modernization and upgrading of its production facilities.
　　III. Effectively Promote Clean Heating in Northern China
　　Adhere to a pragmatic approach: use electricity where appropriate, gas where appropriate, coal where appropriate, and heat where appropriate, ensuring that residents in northern regions can safely stay warm throughout the winter. Concentrate resources on advancing the control of loose coal in areas such as the Beijing–Tianjin–Hebei region and its surrounding areas, as well as the Fenwei Plain, prioritizing comprehensive implementation at the township or county level. By the 2020 heating season, while guaranteeing energy supply, the plain areas of the Beijing–Tianjin–Hebei region and the Fenwei Plain will have largely completed the replacement of loose coal used for residential and winter heating; in mountainous areas that currently lack the conditions for clean‑energy substitution, promote the use of clean coal, strengthen oversight of coal quality, and rigorously crack down on the sale and use of substandard coal. The energy efficiency of gas wall‑mounted boilers must meet at least Level 2 standards. (Led by the National Energy Administration, the National Development and Reform Commission, the Ministry of Finance, the Ministry of Ecology and Environment, and the Ministry of Housing and Urban–Rural Development, with participation from the State Administration for Market Regulation and other relevant agencies.)
　　Strengthen the development of a comprehensive natural gas production, supply, storage, and sales system. Strive to increase the share of natural gas in total energy consumption to 10% by 2020. Prioritize the allocation of additional natural gas supplies to residential use in urban areas and to replacing loose coal for winter heating in regions with severe air pollution, with a particular focus on supporting the Beijing–Tianjin–Hebei region and its surrounding areas, as well as the Fenwei Plain, to achieve the goal of “increasing gas while reducing coal.”
　　Interpretation: Angry Fertilizer Enterprises are among the earliest users of natural gas and have long made significant contributions to supporting agricultural production, while also playing a crucial role in peak‑shaving for China’s national gas pipeline network. Depending on the winter gas supply situation, the operating rates of gas‑to‑chemical enterprises may be affected, which, in addition to impacting urea prices, could also influence other… Fertilizer The product also generates a pull effect.
　　IV. Continue to implement total coal consumption control in key regions.
　　By 2020, the share of coal in the nation’s total energy consumption will have fallen to below 58%; the five provinces and municipalities—Beijing, Tianjin, Hebei, Shandong, and Henan—will reduce their aggregate coal consumption by 10% compared with 2015 levels, while the Yangtze River Delta region will cut its coal use by 5%, and the Fenwei Plain will achieve negative growth; newly built coal‑consuming projects will be required to implement coal‑reduction and substitution measures. In line with the principles of centralized and clean coal utilization, priority will be given to reducing non‑power‑sector coal consumption and increasing the share of coal used for power generation, with the national proportion of coal used for electricity reaching at least 55% by 2020. Efforts to replace coal and fuel oil with electricity will continue, with the scale of such substitution exceeding 100 billion kWh. (Led by the National Development and Reform Commission, with participation from the National Energy Administration and the Ministry of Ecology and Environment.)
　　Interpretation: As production Fertilizer Coal-to-urea (or “coal‑based urea”) accounts for nearly 80% of China’s total domestic production capacity, making it one of the three major feedstocks. At present, the country’s coal‑to‑urea industry is still dominated by conventional fixed‑bed technologies using anthracite, with only 29% employing advanced pulverized‑coal gasification. Prioritizing the reduction of non‑power‑sector coal consumption will compel urea producers to adopt state‑of‑the‑art coal‑gasification processes, thereby boosting efficiency and cutting production costs. As always, the key lies in phasing out outdated capacity and upgrading and modernizing production equipment.
　　V. Optimizing and Adjusting the Freight Transport Structure
　　Significantly increase the share of freight transported by rail. By 2020, national railway freight volume will have grown by 30% compared with 2017, with increases of 40% in the Beijing–Tianjin–Hebei region and its surrounding areas, 10% in the Yangtze River Delta, and 25% in the Fenwei Plain. Vigorously promote intermodal sea‑rail transport, aiming for an average annual growth rate of over 10% in container intermodal shipments at key ports nationwide. Develop and implement an action plan to adjust the transport structure. (Led by the National Development and Reform Commission, the Ministry of Transport, the Railway Administration, and China Railway Corporation, with participation from the Ministry of Finance and the Ministry of Ecology and Environment.)
　　Interpretation: Railway freight is currently the primary mode of transporting agricultural inputs, with costs lower than road transport. Whenever winter stockpiling, fertilizer application periods, or the Spring Festival travel rush arrive, Fertilizer Products cannot be treated on an equal footing with others, and the persistent difficulty in securing sufficient transport capacity has repeatedly delayed fertilizer demand in certain regions, driving up local fertilizer prices and creating obstacles to fair competition among enterprises. Significantly increasing the share of rail freight is a favorable policy for the agrochemical industry.
　　VI. Strengthening the Comprehensive Utilization of Crop Straw
　　Effectively strengthen controls on the burning of crop residues and reinforce the principal responsibility of local governments at all levels for enforcing the ban. In key areas, establish a grid‑based supervision system and conduct special inspections during the summer and autumn harvest seasons to ensure compliance with the ban. In the Northeast region, in response to the concentrated burning of straw during autumn and winter and the simultaneous start-up of boilers at the onset of the heating season, develop targeted work plans and enhance scientific, orderly management and guidance. Strictly prevent regional episodes of severe air pollution caused by open‑air burning of crop residues. Adhere to a combined approach of prevention and facilitation, increase policy support, and comprehensively promote the comprehensive utilization of crop residues, aiming to achieve a national utilization rate of 85% by 2020. (The Ministry of Ecology and Environment, the Ministry of Agriculture and Rural Affairs, and the National Development and Reform Commission shall assume responsibilities according to their respective mandates.)
　　Interpretation: Compared with organic fertilizers derived from livestock and poultry manure, straw is an excellent plant‑based raw material for organic fertilizers, offering high safety and aligning with China’s initiative to promote the substitution of chemical fertilizers with organic ones. Fertilizer This policy is highly beneficial for agriculture. For enterprises, it offers two key opportunities: first, they can use crop residues to produce high-quality organic fertilizers; second, Shandong Quanlin Jiayou has already taken the lead in using straw as a raw material to industrially and standardize‑ly produce humic acids, marking an important step toward developing efficient agriculture.
　　VII. Controlling Ammonia Emissions from Agricultural Sources
　　Reduce Fertilizer Pesticide Application rates, increase the use of organic fertilizers, and achieve Fertilizer Pesticide Negative growth in usage. Increase Fertilizer By 2020, the utilization rate in the Beijing–Tianjin–Hebei region and its surrounding areas, as well as in the Yangtze River Delta, will reach at least 40%. Strengthen the resource‑based utilization of livestock and poultry manure, improve ventilation conditions in farming facilities, increase the overall utilization rate of such waste, and reduce ammonia emissions. (Led by the Ministry of Agriculture and Rural Affairs, with participation from the Ministry of Ecology and Environment and other relevant agencies.)
　　Interpretation: For the agrochemical industry, the State Council has, for the first time, proposed reducing… Fertilizer Pesticide Usage volume is undoubtedly the most significant piece of news. For individual companies, the implications will vary. Fertilizer Zero growth will depend on improvements in fertilizer-use efficiency; single‑nutrient fertilizers may face some challenges, while new‑type fertilizers are likely to benefit.
　　Li Haofeng of Jiangsu Huachang Chemical believes that, following zero growth, the State Council has for the first time proposed… Fertilizer Pesticide Negative growth in usage. For traditional… Fertilizer Modified and enhanced efficiency is to improve Fertilizer One of the key measures for improving utilization efficiency is the promotion of humic acid‑containing urea, alginic acid‑containing urea, urea‑ammonium nitrogen fertilizers, and stabilized fertilizers, which have been shown in practice to effectively reduce… Fertilizer Fertilizer application rates. The Ministry of Agriculture and Rural Affairs should promptly clarify this issue by including these new types of fertilizers in the list of products eligible for registration, and, when conditions are ripe, in the list of products exempt from registration. This would enable these high‑quality fertilizers, which have been widely promoted for many years, to swiftly emerge from their current predicament of being neither registered nor exempted from registration.