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Introduction to nitrogenous fertilizer products

As China’s largest fertilizer supplier, Sinofert is devoted to becoming the country’s mainorganizer of the domestic supply chain in the field of nitrogenous fertilizers. It Utilizes advantages in the firm’s upstream production and its self-owned marketing network, implements specialized markets divisions of labor in the nitrogenous fertilizer manufacturing sector, and form mutually complementary strategic alliances, so as to supply copious amounts of nitrogenous fertilizer products to farmers. As the primary channel of fertilizer trading in our country, Sinofert actively carries out annual dull season fertilizer acquisition and storage scheme, thus making critical contributions to ensuring adequate fertilizer supply for the country. Meanwhile, Sinofert is also aggressively expanding international marketing channels to export greater amounts of fertilizer to markets in South Asia, Southeast Asia, Europe and the Americas.

In order to ensure a stable supply of nitrogenous fertilizer, Sinofert has set up domestic production bases of nitrogenous fertilizer, and invested in domestic large-scale nitrogenous fertilizer manufacturing enterprises by means of equity acquisition, so as to form strategic alliances with domestic nitrogenous fertilizer suppliers.

1. Sinofert established the Tianji-Sinochem Gaoping Chemicals Co., Ltd. through a joint venture with Tianji Coal Chemicals Group Co., Ltd. The new company is located in Jincheng City, the anthracite base of Shanxi Province. The gross project investment exceeds RMB 1.5 billion Yuan. Its installed production capacity consists of 360,000 tons of ammonia, 40,000 tons of methanol, and 600,000 tons of urea. This project was completed and production began in mid 2006. The planned output in 2007 is 600,000 tons.

2. On July 5, 2006, Sinofert bought 50 million shares of Shandong Luxi Chemicals Co., which constitutes about 4.7% of the total enlarged capital shares of Luxi Chemicals. This enables us to sell Luxi’s nitrogenous fertilizer products exclusively in the provinces of Heilongjiang, Jilin, Liaoning and Jiangsu. As a result, the sales volume of the nitrogenous fertilizer products will increase gradually from 150,000 tons in the second half of 2006 to over 500,000 tons in 2008.

3. Sinofert has invested RMB 112.5 million Yuan to buy 15 million shares additionally issued by Shandong Hualuhengsheng Limited Co., and now posesses 4.54% of the enlarged capital shares of Shandong Hualuhengsheng Limited Co., making Sinofert that company’s second major shareholder. Its annual production capacity is of 480,000 tons of ammonia, 600,000 tons of urea, 130,000 tons of DMF, 120,000 tons of methanol and 30,000 tons of formaldehyde.

Sinofert is consolidating and strengthening the construction of supply bases,using capital as its main conduit to partners, deemphasizing asset scale, and placing greater emphasis on marketing operations. Meanwhile, the company also strives to enhance the strategic alliance with key suppliers. It is estimated that sales of over 6 million tons of nitrogenous fertilizers shall be realized in 2009.

Product Characteristics

Sinofert’s urea possesses the following traits:

Nutrient content is high and stable, with nitrogen content at 46%;

Biuret content remains low, at no more than 0.9%, reaching the national “superior grade” product standard;

It is easily soluble in water, the water solution remains at a neutral Ph level, and the soil will be free of leftover material, thus making it favorable for environmental protection;

It is suitable for all types of soil and crops nationwide;

Its uses are extensive, it could be used mainly as base fertilizer and/or refill, as well as for seed and/or leaf mass fertilizer;

The products can be selected and purchased in different grades and prices. Besides the superior grade urea containing 46% nitrogen and under 0.9 biuret, the less expensive but nationally certificated urea, containing 42% nitrogen and under 1.2% biuret, is also available. Urea in large granular form can also be supplied.

Suggestions Fertilizer Application (Kg/Mu) [Note: 1 hectare = 15 Chinese Mu]

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Note: For legume crops, the application quantity should be reduced by 1/3-1/2; for vegetables and fruit trees, well-rotted farmyard fertilizer should be applied.

Fertilizer Application Notices:

Due to its high concentration, urea usually should not be applied in excess. After the urea is applied, the soil should be turned and watered in a timely manner. For sandy soil, urea application should be done in small amounts and numerous times, but do not water immediately after application.

The superior grade product should be used as seed fertilizer. Its application quantity should not exceed 5kg, and its distance from seeds or seedlings should be at least 5cm.

Large granular urea has strong compression resistance, anti-hygroscopic properties, as well as slow release properties, thus making it suitable as a base and/or one-time use fertilizer.

The urea can be fully absorbed by crops, only when is converted into ammonium conditioned nitrates, due to the effects of microorganisms in the soil. Therefore, when the fertilizer is used as spring refill in northern China, it should be applied 3-5 days earlier than the application of ammonium sulfate, ammonium bicarbonate, etc.

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