Rising Di-Ammonium phosphate prices putting food inflation on the edge
- 23-May-2022 6:19 PM
- Journalist: Jacob Kutchner
As per the ChemAnalyst report, the price of DAP (Di-ammonium phosphate) has keenly hiked in the last few months due to supply disruptions and an increase in the price of fertilizers in the global market.
Recently, India has endorsed 3 years fertilizer buy-in deal with Oman India Fertilizer Company to grant 1 million tonnes of crop nutrients a year even though covering the ultimatum of meeting its pre-requisite of fertilizers in the wake of Russia’s invasion of Ukraine. India has released a subsidy of Rs 61 crore for Potassic and Phosphatic fertilizers ahead of the Kharif season from April- to September 2022. According to our analysis, there has been a significant increase of 2.2% in the price of DAP fertilizers in the Indian market.
On the other side, other Asian countries like China have also experienced rebels in the price of fertilizers on account of depletion in fertilizer production and precedence to encounter national concern due to an increase in the price of coal in the country. In accordance with the ChemAnalyst market report, it has been observed that there has been an increase in 3.3% of the market cost for Di-ammonium phosphate in China.
In the USA, the price has been hiked by around 1.6% for the Di-ammonium phosphate market owing to the lowering of soybean harvesting, which is directly dependent on fertilizer usage. The USA is the leading producer of soya bean, which it also uses as feed for dairy cattle, and any shortage to that can lead to inflation in the price of meat and dairy products. According to our market report, it has been noted that continuing series of material cost expansion would not end prior to the situation regarding the Russia-Ukraine war.
As per ChemAnalyst analysis, it is expected that global Di-ammonium phosphate prices are likely to remain buoyant during the forthcoming month, as the current market scenarios are not going to vanish soon.