President of Uzbekistan Shavkat Mirziyoyev has instructed to develop chemical industry and increase the domestic production of fertilizers, the press service of the president reported.
The decisions were made at a meeting held to discuss current financial and economic situation of chemical industry enterprises and development of the industry.
Uzbekistan adopted a program for development of chemical industry for 2017-2021. It envisages implementation of 43 investment projects with a total value of $3.1 billion and the increase of industrial production 2.4-fold, their exports – 2.7-fold, of the share of localized products to 42.5% and mastery of production of 43 new types products, opening up over 3,200 jobs.
However, still the enterprises of chemical industry, including producers of mineral fertilizers have some financial problems.
The costs associated with mineral fertilizers for agricultural needs are not covered. As a result, chemical enterprises are limited in their ability to pay for consumption of natural gas, electricity, phosphate raw materials, sulfuric acid and other types of goods and services consumed, and their accounts payable.
In this regard, starting from 2018, the supply of mineral fertilizers to consumers is planned to be carried out through exchange trades through the intermediation of the “Single agent” of Uzkimyosanoat.
There are also shortcomings in reducing the cost of mineral fertilizers and increasing the profitability of the industry. In particular, 67% of the cost of nitrogen fertilizers is energy costs. Ferghanaazot, Dekhkanabad Potash Fertilizer Plant, Kokand Superphosphate Plant, Ammophos-Maxam and Maxam-Chirchik companies finished 2017 with low profitability, and Navoiazot with losses. In such conditions, enterprises are completely limited in the formation of their own working capital and are forced to solve problems by attracting loans at 16-18% per annum.
In this regard, Uzkimyosanoat was instructed jointly with the relevant ministries and departments to develop a program of concrete measures to reduce the cost of production of chemical products and increase its competitiveness in 2018-2019.
The Uzbek president also stressed a need to develop a sectoral plan for implementation of current and major repairs.
Currently, the country’s need in phosphate fertilizers is at the level of 639,600 tons, which is covered only by 25%. In this regard, by upgrading the existing facilities, it is envisaged to increase production to 177,000 tons in 2019, and by building a new phosphate fertilizer production complex in 2021 – to 550,000 tons. (Trend/Business World Magazine)