Fertilizers are left in Brazil, and ships are diverted to the United States
3 min read
In one of the biggest twists, Brazil imported a record amount of fertilizer, driving up prices and filling warehouses; The result is now a price drop!
Fertilizer shortages could cause crisis in Brazilian agriculture by 2022 Since the beginning of this year, Brazil has faced setbacks in ensuring that fertilizers reach the farmer and price hikes have been a reflection of this. The price of potassium chloride (KCl) at the port, for example, has tripled relative to early January. But since this issue came up, the President Jair Bolsonaro went to Russia to guarantee supplies.
After months of tight supplies, Brazil is now recording a surplus of fertilizer — causing prices to plummet. Imports hit record highs, demand fell and some fertiliser-laden ships were diverted.
According to Bloomberg Agency, Swiss fertilizer producer Ameropa AG returned 17,416 tonnes of monoammonium phosphate (MAP) exports to the US last month.. According to them, this is due to “full silos in Brazil and the declining demand for chemical products in the country’s crops”.
“This move marks a turning point for a country that has imported record amounts of fertilizers this year. As grain prices soar and Russia’s invasion of Ukraine threatens to disrupt global supplies, fertilizer companies have received unprecedented amounts of orders to ensure Brazilian farmers have enough inputs to expand their acreage.
According to the agency, Brazilian farmersFaced with an increase in agricultural input prices earlier this year, already “They plan to cut down on fertilizer and reduce demand when supply is sufficient. Such conditions caused the price of fertilizers to fall in the South American country.
“As prices soared to record highs, farmers decided to reduce orders to protect their margins.said Marina Cavalconte, Green Markets analyst at Bloomberg. According to him, farmers can postpone the application of phosphate fertilizers without compromising on yield because the soil can retain this nutrient for more than a year.
USDA provides US$500 million to produce fertilizers
US Department of Agriculture (USDA) Secretary Tom Vilsack has announced that the agency is taking action to combat the high cost of fertilizers to American farmers. USDA is providing $500 million in grants to increase US-made production to encourage competition and combat these high prices.
“First and foremost, we want it to be used by independent operations. These are outside of the dominant fertilizer companies, which creates competition and creates an opportunity for new players, if you will. We wanted to focus on manufacturing in the US. We wanted to invest in innovation. The manufacturing process or the transportation process or We want to make sure that everything that goes into composting is sustainably produced, in terms of the raw material used, and we hope this brings focus to the farm.
The secretary talks about how the company structures the scholarship program. “Essentially, we have two grant application processes. Prizes for this program can range from $1 million to $100 million. They can cover projects that take three to five years. The first application window after filing is a 45-day application window, and that application window is based on accessibility. There will be an application window for applications designed to demonstrate that they are ready, willing and able with additional resources to provide assistance and relief to farmers for crop year 2023 and crop year 2024 for fertilizers.
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