Subscribe
E-Paper
 |
| Freight trucks park in western Seoul on Nov. 7 amid a shortage of urea water solution due to China's export curbs. Yonhap |
South Korea said Monday it plans to import 200 tons of urea from Vietnam next week in the latest move to help ease a supply shortage of urea water solution, a key material used in diesel vehicles to reduce emissions.
The amount is part of 10,000 tons of urea that South Korea hopes to import from Vietnam and other nations to make urea water solution, according to the finance ministry.
Two hundred tons of urea can produce about 650,000 liters of solution, which can meet demand for just one day based on last year's figure.
Separately, South Korea is set to import 27,000 liters of urea water solution from Australia, including 20,000 liters planned for this week.
The move came as President Moon Jae-in ordered aides to "make utmost diplomatic efforts to secure" urea water solution from foreign countries.
To help facilitate the imports, the government plans to cut import tariffs on the material to zero from the current 5-6.5 percent.
The government has also decided to speed up customs clearance on vehicle-use urea solution. Usually, the inspection process takes more than 20 days, but the customs authorities plan to cut the time to 3-5 days, according to industry minister Moon Sung-wook.
South Korea has been grappling with a shortage of urea water solution, known as diesel exhaust fluid, and its surging prices in recent weeks, as China tightened exports of fertilizers and related materials, including urea, in October amid a power crisis caused by a coal supply shortage. Coal is the main feedstock for urea.
According to the foreign ministry, imports of 18,000 tons of urea from China are currently on hold due to Beijing's export curbs, even though they have been contracted by South Korean firms.
The ministry said it has requested Chinese authorities to expedite customs process for the contracted amount of urea.
South Korea heavily relies on China for its supply of urea water solution, as 97.6 percent of its imports came from China in the first nine months of this year.
In around 2013, South Korean manufacturers of urea shut down their businesses as they lost price competitiveness over foreign rivals, such as China and Russia.
The import unit price of industrial-use urea spiked to $483 per ton in September from around $267 in October last year, according to the Korea International Trade Association.
The number of diesel vehicles is estimated at some 10 million, about 38 percent of registered cars in South Korea.
Of them, 4 million diesel cars, including 2 million freight trucks, must install equipment that requires the use of urea solution to cut emissions under the country's tightened emission rules adopted in 2015.
A possible drawn-out shortage of the diesel exhaust fluid could disrupt logistics across the country as trucks used for transporting industrial goods and parcel delivery may have to suspend their operations.
The government said fire engines and ambulances would have no problems as such key vehicles have secured three-month stockpiles for the material.
South Korea said it will review whether to allow industrial-use urea water solution to be used for vehicles based on safety tests and will immediately take actions when needed.
To deter market manipulation attempts, the government began crackdowns on excessive hoarding of urea water solution and its illegal distribution.
Hoarders of urea or water solution could face a jail term of up to three years or a fine of up to 100 million won ($84,000). (Yonhap)
