China's Urea Export Policy in 2026: Quotas, Floor Prices and the 2027 Question

Why does China's export policy matter so much in 2026?

Because China can add or remove millions of tonnes from world trade by changing an administrative rule. China was once the world's largest urea exporter, shipping 13.7 Mt in 2015 ^[1]. After controls began in late 2021, exports fell to just 0.26 Mt in 2024 before recovering to about 5.0 Mt in 2025 ^[1,2].

In 2026 that flexibility became decisive. With Gulf exports cut sharply by the Hormuz crisis, the International Food Policy Research Institute (IFPRI) identified China, together with Russia, Egypt and Indonesia, as the main suppliers whose export rules would decide how far prices could fall ^[3]. IFPRI estimated that a severe tightening by these countries could add about $134 a tonne to urea prices, while relaxing restrictions could bring urea back below pre-crisis levels by early 2027 ^[3].

How do China's urea export controls work?

The system has three layers, according to industry and official sources:

1. Inspection. Since 15 October 2021, fertiliser exports under 29 customs codes need export commodity inspection, which gives authorities a practical way to slow or stop shipments ^[4].
2. Allocations and windows. Exporters receive allocations, often described as self-discipline quotas, valid for set periods. In 2026 the main window was June to August, with some sources citing a provisional end date of 31 October ^[4].
3. Floor prices. Authorities set minimum FOB export prices. When exports reopened in early June, the floor was reported at about $660 a tonne ^[5]. By September, floors of about $430–440 a tonne applied to most destinations, with about $500 for India-bound cargoes ^[2,5].

The policy aims first at domestic supply security. Exports are allowed when domestic stocks are comfortable and prices low, and tightened before the main planting seasons.

How much urea has China exported in 2026?

Less than in 2025 so far, but with a strong summer pick-up. Reported monthly exports were about 308,000 tonnes in January, then fell to almost nothing in the spring, with April–June 2026 combined at about 25,000 tonnes ^[6]. Shipments then rose to about 403,000 tonnes in July and about 525,000 tonnes in August ^[6]. Fertiaxis puts January–August exports at roughly 1.43 million tonnes ^[4].

For comparison, August 2025 exports were about 797,000 tonnes and September 2025 about 1.37 million tonnes, the peak of last year ^[6]. The August 2026 cargoes went mainly to Vietnam, South Korea, Brazil, Colombia, Chile and Mexico ^[6]. India took a large share through tenders rather than monthly flows: Chinese suppliers committed 1.6 million tonnes to the RCF tender that closed in August ^[7], and Bloomberg reported that China was set to supply at least 1.2 million tonnes to that tender ^[8].

Why do the quota figures disagree?

Readers will see two very different numbers. Fertilizer Daily and several market notes report a 2026 export quota of about 3.3 million tonnes, about a third below 2025 shipments ^[2]. Discovery Alert gives the same 3.3 Mt total, split into 2.97 Mt for state trading and 0.33 Mt for non-state trading ^[1]. Bloomberg, cited by Fertilizer Daily, instead described a 2026 export allowance of roughly 5–5.5 million tonnes ^[8].

Fertiaxis offers one explanation. It notes that a Ministry of Commerce document lists 3.3 million tonnes as China's 2026 import tariff-rate quota for urea, which governs imports into China, not exports ^[4]. It found references to an export allocation of about 2 million tonnes for the June–August window, while another source cited about 3 million tonnes ^[4]. China does not publish a single official export ceiling, so all these figures should be treated as estimates. What matters for the market is the monthly customs data, which shows the actual flow.

How is China pricing its urea now?

Below most competitors. On 6 November, Chinese prilled urea was assessed at $341.50 a tonne FOB, compared with $440 for Middle East granular and $517.50 for Egyptian granular ^[9]. A weekly Chinese granular series stood at $420 FOB ^[9].

The low prilled price reflects supply pressure at home. In mid-August, Chinese urea output was running at 204,600 tonnes a day, and January–July production reached 45.27 Mt, up about 9% on the year ^[10]. Port inventories on 13 August were 714,300 tonnes, up 131.24% from a month earlier ^[10]. In late October, the Australian Fertilizer Corporation described Chinese inventories as large and domestic demand as subdued ^[11].

Even so, Chinese sellers turned down India's October tender, where the lowest offers were near $352 a tonne CFR ^[11,12]. Keyuan Fertilizer noted that no Chinese supply was among the winning bids ^[12]. The Australian Fertilizer Corporation estimates that a new Indian tender at $370–375 CFR would give Chinese producers netbacks of about $345–350 FOB ^[13]. That is close to current prilled values, so China's participation will depend on whether producers accept that level and on how authorities treat India-bound floor prices.

What does China's policy mean for importers?

For countries that depend on Chinese urea, the main risk is sudden change. South Korea learned this in 2021, when Chinese export curbs caused a nationwide shortage of vehicle urea solution; before 2021 China supplied 80–90% of Korea's urea ^[14]. Korea has since raised its public reserve from 50 to 70 days of supply and subsidised non-Chinese contracts, but in January–September 2025 China still supplied 62.4% of its industrial and automotive urea imports ^[14].

For India, Brazil and Southeast Asia, Chinese supply has been the main substitute for lost Gulf tonnes in 2026. Its availability in the first quarter of 2027, before the Northern Hemisphere spring season, will be one of the biggest factors for prices.

What to watch

• Monthly customs data for September and October, which will show whether shipments continued after the summer window ^[4,6].
• 2027 allocations and floor prices, typically signalled in the second quarter ^[1,5].
• India's next tender and whether Chinese prilled urea is offered at the expected netbacks ^[12,13].
• Domestic stocks and output, which decide how much room authorities have to allow exports ^[10].
• Gulf supply: a Hormuz reopening would reduce the pressure on China to export ^[3].

Alupetra follows urea and nitrogen trade between China, South Asia and Europe from Istanbul, London and Dubai; Alupetra does not deal with sanctioned parties.