On January 19, 2022, the “Symposium for Nitrogen-Based Fertilizer Enterprises in Jiaocheng County and the Working Meeting of the Calcium-Magnesium Fertilizer Branch of the China Nitrogen Fertilizer Industry Association” was held in Jiaocheng, Shanxi Province. Wang Xiangqian, Deputy County Magistrate of Jiaocheng County, along with leaders from the Bureau of Small and Medium-Sized Enterprises and the Jiaocheng County Bureau of Industry and Information Technology, attended the meeting to provide guidance. At the meeting, a total of 13 nitrogen-based fertilizer enterprises—including Shanxi Huaxin, Shanxi Jinlan, Jiaocheng Sanxi, Shanxi Hongxing, and Shanxi Leixin—introduced their basic company information, outlined the challenges and demands they face in their development, and offered their insights. From an industry perspective, the Calcium-Magnesium Fertilizer Branch of the Nitrogen Fertilizer Association conducted an in-depth analysis of the current situation. County leaders pointed out that nitrogen-based fertilizers have become a distinctive local industry in Jiaocheng County, accounting for more than half of the national and even global market share. Nitrogen-based fertilizer enterprises should focus on the supply-side reform in agriculture, strengthen cooperation between the association and the government, accelerate product innovation, and thereby promote green, high-quality agricultural development in the Jiaocheng region.

The main contents of this meeting are as follows:

Niu Tianliang, from the Nitro-Calcium-Magnesium Fertilizer Branch of the China Nitrogen Fertilizer Association, introduced that in recent years, with the close attention and strong support from relevant higher authorities and the county government, Jiaocheng’s nitro-fertilizer enterprises have developed into an industrial cluster capable of producing annually 1.6 million tons of ammonium nitrate-calcium, 200,000 tons of magnesium nitrate, 300,000 tons of calcium nitrate, and 200,000 tons of potassium nitrate. The cluster currently comprises 21 production enterprises, employs over 5,000 people, and has an annual output of nearly 2.3 million tons of related products. Local synthetic ammonia capacity stands at approximately 600,000 tons, while nitric acid production exceeds 1.6 million tons, forming a unique industrial chain for nitro-based products. Production and sales volumes have been growing at an annual rate of over 40%. Jiaocheng County’s calcium nitrate and ammonium nitrate-calcium products, which are its main export items, account for 80% of the domestic market and more than 50% of the international market, making a positive contribution to the country’s foreign exchange earnings from exports. Nevertheless, many issues still remain to be addressed urgently.

First, Announcement No. 81 of 2021 issued by the General Administration of Customs of the People’s Republic of China stipulates that “exported fertilizers will be subject to export commodity inspection starting from October 15, 2021.” All enterprises have been carrying out statutory inspections as required; however, to date, they have still not received any results, which has had certain negative impacts on local economic development and social stability. This has dealt a severe blow to nitro-fertilizer manufacturers—their industry is one of the region’s leading sectors. We sincerely hope that the government and relevant authorities will extend their assistance.

Second, although the calcium-magnesium fertilizer industry has developed relatively rapidly in recent years, due to its low technological and investment barriers, coupled with differences among enterprises in terms of scale, facility levels, and management capabilities, there is a certain degree of unhealthy competition. This has led to significant price fluctuations, thereby hindering the industry's healthy development.

Third, given that most enterprises have small-scale investments and lack adequate warehousing and financial resources, to address the challenges of storage during both peak and off-peak seasons and ensure stable enterprise operations, local governments need to provide support in terms of land and policies. We hope that the relevant departments will promptly conduct research and accelerate the implementation of warehousing and logistics projects for fertilizer enterprises in the Jiaocheng area.

Fourth, in recent years, the industry has experienced rapid development but also intense, unhealthy competition, leading to low investment returns and sluggish technological progress—conditions that have remained at a low level for some time. For example: the treatment of acid-leaching tail gases remains unstable and needs to be further improved; the granulation process generates excessive dust, necessitating enhancements to the granulation technology; and waste residues are still not properly treated, calling for centralized and coordinated management. We recommend that, under the leadership of the government, our industrial park, the Commission of Economy and Information Technology, and the National Development and Reform Commission establish entry barriers for the industry. These barriers should address multiple aspects—including technology, environmental protection, and safety—and, in accordance with relevant policies, strictly enforce compliance and rectification measures against non-compliant enterprises. We must firmly put an end to short-term practices such as disrupting market order, pursuing quick profits at all costs, and engaging in price-cutting promotions. Otherwise, the distinctive local industries that have developed over many years will gradually shrink.

Director Jia from the Jiaocheng County Bureau of Small and Medium-sized Enterprises stated that most of the companies present here are “high-tech enterprises.” Everyone has felt the nation’s strong support for high-tech enterprises. High-tech enterprises enjoy numerous benefits, the most important of which is that they are taxed at a reduced corporate income tax rate of 15%, and their R&D expenses can be deducted or added at a rate of 175%. We hope to help all enterprises become high-tech enterprises and guide them onto the path of technological innovation!

Vice County Magistrate Wang of Jiaocheng County proposed that everyone should unite their hearts and efforts, stand in solidarity, and boost confidence to further enhance the reputation of Jiaocheng as the “Calcium Capital,” run the Calcium-Magnesium Association effectively, and expand and strengthen the nitro-fertilizer industry. After listening to the presentations from various enterprises, we indeed have some concerns. It is understood that calcium-magnesium fertilizer companies are relatively small in scale, which implies weak risk resistance. Therefore, it is recommended that these companies focus on multiple aspects—product quality, efficacy, efficiency, and rapid effectiveness—to increase the added value of their products. The level of technological advancement determines energy consumption limits; production should be aligned with energy consumption targets, and companies should strive to avoid homogeneous competition as much as possible.

In terms of enterprise management, we must shift from loose management to standardized management and ensure that management is geared toward achieving efficiency. At the same time, enterprises should share resources rather than going it alone. Process technologies must advance, product performance must be innovated, and product quality and branding must be enhanced, enabling the industry to become “strong,” “large,” “refined,” and “meticulous.”

In terms of government policies, the development of economic and chemical industrial parks represents the next key area of focus for rural revitalization. The government will also continue to improve the supporting infrastructure and public service platforms within these parks, which is highly beneficial to the economic development of the nitro-fertilizer industry. The export-related issues raised by various enterprises are temporary in nature. Subsequently, the Calcium-Magnesium Fertilizer Branch will work closely with the government, communicating with the National Development and Reform Commission and customs authorities at higher levels to resolve these issues as soon as possible.

In terms of market development, the market is the paramount factor. It’s an ironclad rule that the market should dictate production. The current downturn stems from a supply-demand imbalance—specifically, oversupply. At the heart of this oversupply lies export restrictions; the second key factor is market development. The association and the government are jointly funding an initiative to invite agricultural research institutions from across the country to Jiaocheng for field studies. This will facilitate further collaboration and partnerships with these institutions, enabling the development of new products, promoting technological upgrades and industrial restructuring among nitro-fertilizer enterprises, and ultimately boosting the growth of the nitro-fertilizer industry.

The government will provide enterprises with an excellent development environment, encouraging everyone to go global and enhance the industry’s competitiveness, thereby ensuring the steady development of the nitrofertilizer industry!

Finally, Li Tengfei, Chairman of the Nitro-Calcium-Magnesium Fertilizer Branch of the China Nitrogen Fertilizer Association and General Manager of Shanxi Huaxin Fertilizer Industry, summarized by saying that the past winter was a bitterly cold one, and the pressure from the pandemic has yet to subside. This year has been particularly “difficult” for calcium-magnesium fertilizer companies. He expressed gratitude for the government’s timely intervention, which has served as a powerful “boost” for these enterprises. County Magistrate Wang provided policy guidance from both industrial and market perspectives, offering direct assistance especially in areas such as export issues, market development, and industrial upgrading. The association will certainly actively cooperate on export matters and intensify promotional efforts to expand both domestic and international markets. To summarize the challenges faced by various enterprises, the industry will focus on the following key areas for improvement. First, as the calcium-magnesium fertilizer industry continues to evolve, it is imperative that companies pursue a path of industrial and product transformation. Under conditions of supply-demand imbalance, all enterprises need to plan ahead. Second, we must build confidence in our products. In today’s rapidly developing nitro-fertilizer industry, existing nitro-fertilizer production capacity does not yet match current consumption levels. Our nitro-fertilizers have tremendous potential, and the market outlook is widely optimistic. It is crucial that all nitro-fertilizer companies work together with a spirit of pragmatism, boldly explore new opportunities, and dare to innovate—thus empowering “Jiaocheng, the Calcium Capital!”