Council of Agriculture (COA) Minister Chen Wu-hsiung (陳武雄) said on Monday that prices of urea might be reduced thanks to plummeting oil prices on the world market.
“Although the government promised that fertilizer prices would be maintained through the end of the year after it imposed a price hike in late May, the council will study the possibility of adjusting prices downward as a result of continued declines in international oil prices,” Chen said at meeting of the legislature’s Economics Committee.
A council fertilizer price screening panel and the state-run Taiwan Fertilizer Co would work together on the feasibility of a price reduction based on future oil price trends, Chen said.
“The panel might devise a ‘long-term pricing mechanism’ to openly reflect fertilizer production costs and take better care of farmers,” he said.
Urea is being targeted because it is the only chemical fertilizer derived from petroleum, he said.
He said on May 28 that the price for a 40kg bag of urea would rise NT$370 per bag to more than NT$800 a bag as of May 30 to reflect the soaring costs of raw materials.
As part of the government’s efforts to help minimize the financial burden of the price hike on farmers, the council pushed Taiwan Fertilizer to absorb nearly 70 percent of the increase, leaving farmers to pay between NT$520 and NT$530 per bag. However, the increase still upset farmers.
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