Government vows to fix urea crisis amid public doubts

Urea solution is packaged at a Kumsung E&C facility in Ansan, Gyeonggi. [YONHAP]

The Korean government has vowed to double its stockpile of urea, but the public is not convinced. The government has, critics say, repeatedly failed to secure a sufficient supply of the material despite having experienced a urea crisis two years ago.

China's recent export curbs have left the government scrambling to find alternate sources of the chemical compound.

The Ministry of Trade, Industry and Energy said Wednesday that the Public Procurement Service (PPS) is taking measures to double its current 6,000-ton state inventory of urea for cars, which is enough to run cars for one month, to 12,000 tons, which will last two months. Around 2,000 tons of the state's stock will be released early to businesses that have had their supplies disrupted.

As of Wednesday, the total domestic stock — which is mostly privately held — of urea for cars has increased by 5,000 tons, and can now last 3.7 months, rather than the 3 months-worth that had been reported earlier, the Ministry said in a statement.

The government is also monitoring the local supply of urea and will set purchase limits for gas stations and civic organizations representing car owners.

While the Trade Ministry is still making efforts to secure urea through Chinese supply chains, it also plans to support companies in importing urea from countries other than China if the blockage continues for too long.

But some feel that the response is too little, too late, with Korea's state inventory of key resources revealed to be bare. The currently secured stockpile of urea is mostly in the hands of companies, and the reserve of rare materials is only half the amount of the set goal.

Chinese customs authorities blocked clearance for urea shipments bound for Korea without explanation. Urea is a chemical compound used as a fertilizer and in the making of exhaust fluid for diesel engines.

The government had said Tuesday that around three months' worth of industry-grade urea was secured, which is the added amount of the remaining stock and imports scheduled to come in from countries other than China, including Vietnam. Most of the secured stockpile is owned or will be imported by companies that use urea, such as Lotte Fine Chemical.

The government currently holds 6,000 tons, which merely accounts for 2 percent of the 290,000 tons imported from January to October this year.

Last year, Chinese urea accounted for 67 percent of Korea's net urea imports. This year, however, 90 percent of the country's urea imports came from China from January to October.

Meanwhile, the budget for next year to find new measures to procure urea for cars was set at “zero” in the PPS's reserve fund execution plan, according to the National Assembly Budget Office's budget analysis report for next year.

Korea also doesn't have enough critical minerals in the stockpile that are essential for the semiconductor and EV battery industries.

The average reserve of 13 rare metals held by the Korea Mine Rehabilitation and Mineral Resources Corporation can last Korea for about 50 days, according to People Power Party Rep. Lee Jong-bae on Tuesday.

This is half the amount of the government goal of 100 days.

“If over 70 percent of a resource is imported from one country, it should be treated and secured as a key material, even if it is not rare, such as urea. A systematic plan to secure key minerals should also be established at once,” Kang Cheon-gu, visiting professor of energy resources engineering at Inha University, said.

“The government must keep up a sufficient amount of inventory and be responsible for distribution in times of emergency,” he added.

BY KIM JU-YEON, JEONG JONG-HOON [kim.juyeon2@joongang.co.kr]