Fertilizer giant sees prolonged disruption from Ukraine war

Canada’s Nutrien Ltd, the world’s biggest fertilizer producer, said on Tuesday that Russia’s invasion of Ukraine could result in prolonged disruptions to global supplies of potassium and nitrogen for crops.

The company’s interim chief executive, Ken Seitz, said Nutrien will increase potash production if it sees sustained supply problems in Russia and Belarus, the world’s second and third largest potash producing countries.

Prices are on the rise in Brazil

The escalation of geopolitical tension that culminated in the beginning of the war in Ukraine is already affecting the price of fertilizers used by Brazilian agribusiness. Survey carried out by the Confederation of Agriculture and Livestock of Brazil (CNA) at the request of the CNN Brasil Business shows that the prices paid by Brazilian agribusiness increased by up to 5.8% in just one week.

In dollars, the value paid for fertilizers derived from urea reached US$ 642 a ton at the port of Paranaguá, in Paraná, on Thursday, 24th. The value is 5.8% higher than the US$ 607 registered a week earlier, in February 17, according to the CNA.

Fertilizers derived from potassium chloride (KCl) increased by 1.1% in the same period, to US$ 867 a ton in Paranaguá. Monoammonium phosphate (MAP) fertilizers increased by 0.5% to US$ 971 a ton. The CNA notes that the price of these inputs was already on an upward trajectory, and the trend intensified with the escalation of geopolitical problems.

The entity does not report problems in the supply of fertilizers. In this market, Russia is the world’s largest exporter (with a share of 13.3%) and Belarus, the fifth (4.96%). On the other hand, Brazil is the world’s largest importer, with about 13% of the entire volume purchased by the planet.

Government expresses concern

The Brazilian government has expressed concern about the possibility of an increase in the price of fertilizers in the face of economic sanctions against Russia.

According to reports made to CNNthe Ministry of Agriculture has been in contact since Thursday morning (24) with exporters of the product and Brazilian diplomats to assess the impact of the conflict on the Brazilian trade balance.

The fear is that the interruption of exports by Russia and Belarus will raise the price of the product, harming this year’s Brazilian crop.

To avoid the scarcity scenario, the Brazilian government has discussed increasing imports from countries such as Canada and Iran, as it currently does not have enough stock in the country.