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Fertiliser famine threats to hit harvests
Steve Dube, Western Mail (Wales)
A SHORTAGE of fertiliser threatens to hit farm production this year. The price has doubled in 12 months and products are in short supply, with manufacturers and distributors unable to say when things will improve.
“We can’t get any,” said Graham Hughes, general manager of Carmarthen and Pumsaint Farmers. “In a normal year we would expect to be selling at least 8,000 tonnes by the end of April. We’ve had nothing for over a week and the last delivery we had was only 300 tonnes, which we sold to six farmers straight away.”
…Rosie Carne, marketing manager for the leading fertiliser company Yara UK, said the problem dates back to 1999 when 3.5m tonnes was taken out of world production levels.
Now the end of the set-aside subsidy and increased grain production across the world to meet growing demand in China and India and the rise of biofuel production in the United States, coupled with high energy costs had created a shortage and a sharp rise in prices.
In addition, potash and nitrogen are in particularly short supply. And most forecasters say it could be two years before the problem eases.
… Calum Findlay, fertiliser trader for Gleadell Agriculture, said the need for more nitrogenous products in the UK is greater than ever as more land continues to be brought back in to cultivation.
“This season’s demand is set to reach almost two million tonnes and with little or no imported ammonium nitrogen arriving, supply is now king – no longer price,” he said.
“The global nitrogen supply picture suggests that even with new production capacity coming on stream it will be 2010 before supply once again catches up with demand.
“Even with lower gas prices global demand will continue to dictate high prices and combined with record low world stocks of both phosphate and potash the days of cheap fertiliser are now probably lost forever.”
Mr Findlay said the UK fertilisers market, like the grain market, has changed and is now driven by global events.
(5 February 2008)
Contributor Aaron Edmonds (an Australian grain and sandalwood nut producer) writes:
Farmers also hoarding up to 2 years worth of fertilizer inventories to avoid anticipated price rises and shortages. The same is happening with herbicides in particular glyphosate and atrazine.
Gulf to become major fertiliser producer
Nadim Kawach, Business 24-7 (United Arab Emirate)
The UAE and other Gulf states are expected to pump billions of dollars in the next few years into expanding their fertilisers industry to face an upswing in global demand as a result of agricultural expansion, according to an official study.
The combined capital invested by the GCC states in fertilisers until the end of 2006 has totalled about $5.7 billion (Dh20.9bn).
The six Gulf Co-operation Council (GCC) states, which control more than 40 per cent of the world’s oil and a fifth of global gas wealth, are already among the largest fertiliser producers and the new projects will strengthen their position in the industry, said the study by the Doha-based Gulf Organisation for Industrial Consulting (GOIC), which advises on GCC manufacturing policies.
(4 February 2008)
Looks like a smart move in view of rising fertilizer prices. -BA
It’s Time to Be More Accurate With Fertilizer
Nebraska Farmer
It’s no secret that fertilizer supplies are tight, and nitrogen and phosphorus prices have increased dramatically in the last year.
Because of those factors, Charles Shapiro, UNL soils specialist in Concord, says that proper nitrogen fertilizer application at UNL recommended rates is even more important in 2008.
Nitrogen and corn prices have typically been in the 8-to-1 to 10-to-1 corn-to-nitrogen ratio, and UNL nitrogen recommendations were designed to be most economical in that range. Adjustments are needed when the ratio is either higher or lower, Shapiro says.
Recently, UNL introduced an adjustment to take into account the changing economic conditions.
With March corn at $5.07 per bushel and nitrogen prices at about 50 cents per pound, the corn-to-nitrogen price ratio is at the recommended 10-to-1 range. This will not significantly impact UNL nitrogen recommendations for Nebraska’s corn growers this year, Shapiro says.
“The cost of under applying nitrogen is always a lot higher than over applying, but our recommendations are profitable. Since fertilizer prices are a lot higher now, it is more important that our recommendations be followed closely,” Shapiro says.
(6 February 2008)
Farm group backs plan for fertiliser price probe
ABC
The South Australian Farmers Federation (SAFF) is welcoming a plan for the Australian Competition and Consumer Commission to investigate fertiliser prices.
The investigation will be part of a wider probe into grocery prices.
Fertiliser prices have more than doubled in the past two years, with some farmers questioning whether they will be able to afford it this year.
SAFF president Wayne Cornish says the investigation is a timely one as farmers try to recover from the drought.
“Fertiliser prices have escalated really out of this world, and given the cash flow of people on the land at the moment, to see them escalate to the degree that the speculation would have us believe that it’s going to be this year, is a little more than some can stand and we would welcome the announcement,” he said.
(4 February 2008)
Market Spotlight: Fertilizer Companies
Stan Choe, Associated Press
Fertilizer companies were stinkers this year – until recently.
Yet stocks in the sector were among last year’s biggest gainers, and analysts believe the same trends that propelled them remain in place.
Grain prices are rising around the world as people in developing countries gain income and consume more meat. Livestock require feed, which boosts demand for fertilizer. Capacity, meanwhile, is relatively constrained.
“Growing food is not a luxury,” said Goldman Sachs analyst Edlain Rodriguez. He likes Potash Corp. of Saskatchewan in particular. The company is the largest producer of potash _ a mineral used in fertilizer _ in the world and a major producer of nitrogen and phosphate products.
(30 January 2008)
