Upbeat mood in fertiliser industry

7 July 2011

Upbeat mood in fertiliser industry

Ballance Agri-Nutrients says higher demand across all food commodities should translate into steady demand for fertiliser over the year.

Chief Executive Larry Bilodeau says the rising commodity market meant the mood among fertiliser producers at the recent International Fertiliser Association Conference in Canada was upbeat.

The IFA represents more than 500 members from 85 countries who collectively produce more than 170 million tonnes of fertiliser annually. Its annual conference examines supply and demand trends as well as environmental and technical issues.

“Delegates at the conference were bullish about demand and prices. However, it’s important to temper optimism with caution given some of the economic uncertainties we are seeing return, particularly across Europe. We’ll be watching those trends closely.”

He says he’s not anticipating the dramatic highs and lows seen in fertiliser pricing in 2008/09 when the economic downturn saw commodities peak and slump, impacting fertiliser demand.

“Our expectations are for a narrower pricing band, rather than dramatic highs and lows. Supply and demand fundamentals for phosphate, urea and potash, for example, is reasonably stable and while sulphate of ammonia is in tight supply, we have very good supply relationships.”

Mr Bilodeau says improved farmer confidence, especially in the meat and wool sector, should translate into a steadier demand pattern, with farmers able to budget for fertiliser with more certainty. This contrasted with earlier in the year when demand signals from farmers were initially modest, then ballooned when meat returns rose sharply.

“With a three month lead time for imported product, a steadier demand pattern enables us to more accurately forecast our raw material requirements. As with last year, our aim is to give farmers consistent signals on where we see prices heading so they can give us consistent signals on their fertiliser requirements. That way we’re better placed to secure supplies at the right prices for our customers.”
ENDS

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