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Priority should be given to meeting the coal and electricity needs for fertilizer production. Author/Source: Sinochem News Network. Date: 2021-11-01. Clicks: 26. Recently, the National Development and Reform Commission and the Ministry of Industry and Information Technology have conducted investigations in various regions to understand the issues related to the supply of coal, electricity, transportation, and storage that affect fertilizer production at present. Enterprises across the country have generally reported that since late September, skyrocketing coal prices and shortages of coal supplies, along with power rationing imposed by utility companies, have placed immense pressure on their production and operations. Recently, fertilizer output has dropped sharply; in some areas, the price of urea has surpassed the 3,000-yuan mark. There is a risk that there may not be enough fertilizers available for autumn planting and next year’s spring sowing. According to statistics compiled by the Shandong Province Fertilizer and Coal Chemical Industry Association, as of late September, less than 50% of the key fertilizer manufacturers in the province had received their coal supplies; their inventory levels dropped sharply, with half of these companies having inventory levels below the 7-day threshold, forcing them to suspend or reduce production. Worse still, during the National Day holiday, due to continuous rainfall in the Yellow River basin, a large number of coal mines in provinces such as Shanxi were shut down and railway transportation was disrupted. Coal-consuming enterprises fell into panic and rushed to buy coal from intermediaries in the market, but it was still extremely difficult to obtain any supply – even those with money could not get coal. Some company executives reported that in mid-October, the purchase price of raw coal for their company was 2,250 yuan per ton, which is 1,725 yuan per ton higher than the average price in May last year (an increase of 328.57%), and 1,643 yuan per ton higher than the average price during the same period last year (an increase of 270.68%). It was also 1,100 yuan per ton higher than the price in September (an increase of 95.65%). Based on current coal and electricity prices, urea manufacturers are already operating at a loss. In addition, fertilizer manufacturers across the country have also been frequently subjected to power cuts after mid-September. A key nitrogen fertilizer manufacturer in Shandong was subject to a power restriction of 50,000 kilowatt-hours per hour, forcing it to shut down one ammonia synthesis and urea production unit; as a result, its fertilizer production was reduced by half. More serious than the decline in production is the impact of power rationing on enterprises’ safe production. Since most fertilizer manufacturers carry out integrated fertilizer production, operating continuously 365 days a year, power rationing measures imposed at different times force the plants to start and stop frequently as well as to adjust production levels, which poses significant risks to the safe and stable operation of the plants as well as to the control of environmental standards. Fertilizers are important agricultural production materials and crucial resources for ensuring agricultural production and maintaining **food security**. Current difficulties in coal procurement and power shortages are severely affecting fertilizer production. It is understood that due to rising coal costs, fertilizer prices have remained high throughout this year. Currently, there are virtually no stocks of fertilizers in the market; middlemen have reduced their inventory levels, and lower production by manufacturing firms will result in a shortage of fertilizers available during the planting season. This autumn, persistent rain in the five provinces along the Yellow River has delayed autumn planting, leaving little time for urgent harvesting and sowing. It is crucial for this year’s autumn planting and next year’s spring plowing that the relevant departments ensure a proper supply of coal and electricity, as well as maintain the operations of key fertilizer manufacturers. First, a comprehensive approach is needed, with flexible measures taken in urgent situations, to ensure the supply of coal and electricity for fertilizer production. Given the current domestic resource conditions and industrial characteristics, only by ensuring a supply of coal and electricity for fertilizer manufacturers can agricultural production be sustained. It is recommended that the relevant departments step up coordination, increase the coal quotas as well as the supply of coal and electricity for nitrogen fertilizer manufacturers that are vital to the national economy and people’s livelihoods, and ensure a stable and sufficient supply of coal required for fertilizer production in accordance with long-term contracts. At the same time, it is also necessary to guide the commercial reserve storage enterprises in the region to carry out the storage of various fertilizer products in batches. Secondly, the high energy consumption associated with fertilizer production should be downplayed, and the role of fertilizer companies in supporting agriculture should be emphasized. So far, the only things that have been clearly defined are “dual-high” products and “two-high” projects; there is no such thing as “two-high” industries or “two-high” enterprises. However, some departments broadly classify the petrochemical industry as part of the “two high” sectors, and they include both raw material coal and fuel coal in the total energy consumption figure ； Some provinces have labeled fertilizer products as high-energy-consuming, restricting new production capacity and advancing the deadline for phasing out fixed-bed gas production units, thereby creating policy barriers for fertilizer production. Fertilizer production plays a strategic role in supporting agriculture, and we should not give up on it just because of difficulties. The transformation of traditional industries takes time, and efforts to reduce energy consumption and coal use should be carried out in a gradual manner. It is necessary to resolutely put an end to \"campaign-style\" carbon reduction efforts and \"one-size-fits-all\" measures to cut energy use; excessive pressure and overreliance on such measures can lead to shortages of energy chemicals and basic products. The recent sharp rise in prices of upstream commodities and fertilizer products serves as a warning.