US Retail Fertilizer Prices Continue Upward Trek into Q3 2021, Likely To Stay Strong As Per World Bank Estimates
- Journalist: Harold Finch
Prices for all major fertilizers are incessantly rising in the retail market. Potash, among the fertilizers, is the strongest which is leading the price increase by gaining close to 7% on month-on-month basis. Sharp increase in Potash prices has been due to multiple factors as supply fundamentals remained tight and global demand for Potash remain highly rich.
Other fertilizers have followed suit and relatively moderate increase has been witnessed in the key fertilizer consumed globally which include Urea, UAN28, UAN32, Liquidated Ammonium Phosphate, DAP, MAP and Anhydrous Ammonia.
Since the beginning of 2021, all key fertilizers are going strong, firstly due to spring sowing season in USA which began later than usual because of extreme weather as severe cold and untimely prolonged rain disrupted normal sowing of crops. Secondly, supply side disruptions were also encountered as imports of fertilizers were hampered due to extreme weather and production shortages globally. Consumption has been strong primarily by the agricultural sector and followed by industrial sector which has resulted in strong demand.
Retail urea prices have gained 47% since the beginning of this year and stands at USD 541 per MT, whereas similar gains have been noticed in other fertilizers as well.
DAP has increased close to 40% and assessed at USD 670 per MT, MAP increased by USD 177 per MT and measured at USD 720 per MT. UAN28 and UAN32 increased by more than 75% and 67% respectively since the beginning of the year.
Potash has risen by 27% and stands at USD 469 per MT, whereas Anhydrous Ammonia measured at USD 724 per MT with an increase of whopping 54% since the start of 2021. Lastly, Liquidated Ammonium Phosphates have gained around 35% and last calculated at USD 625 per MT.
Increasing raw material costs have been also at forefront in driving the prices for fertilizers upwards. Phosphates depend upon Ammonia and Sulfur as raw materials and significant increase in Sulfur and Ammonia prices have been behind the incessant climb of MAP, DAP, and other Phosphates pricing.
Long-term outlook for the fertilizers looks strong as according to World Bank estimates prices are likely to remain high for most fertilizers in coming months. However, outlook for 2022 is anticipated to normalize and reduction in prices can be expected in 2022.