Policy risk still is fertilizer industry is main risk

From January 1, 2008 domestic DAP production was obtained avoid draft policy of privilege of value added tax, also ended to be before this DAP is only the history of a kind of chemical fertilizer that did not enjoy privilege of value added tax (this also is the main reason) that we are in 7 years to think phosphate fertilizer industry should not get control first half of the year.

The setting that value added tax publishs is price of domestic and international DAP rises continuously: At present domestic price relatively rise at the beginning of 2007 extent was achieved 70.8% . At the same time American DAP FOB has risen 680 dollars / ton, relatively extent rises at the beginning of 2007 for 165% . Avoid ask for value added tax to reach to DAP industry basically appear on the market the company is benefit good: Calculate according to us, value added tax is avoided proof can increase DAP industry profit 625 million yuan or so, basically appear on the market appropriate of chemical industry, Hubei turns 6 countries of company EPS will be added respectively thick 0.249 control with 0.093 yuan. But because the country is avoided,we think to impose DAP value added tax is to support price of agricultural development, stable chemical fertilizer, because this obtains favourable policy circumstance to fall in the industry, sequel faces DAP price by the risk of control, can affect boom of domestic DAP industry thereby. Policy risk still is fertilizer industry main risk.