The current state of global fertilizer supply and demand is creating a challenge on the farm, to put it mildly. Demand is very high, supplies aren’t where they need to be, and the resulting high prices likely won’t be going away soon.
“Supplies are very far down compared to normal levels,” says Josh Linville, a farmer and Director of Fertilizer at StoneX. “Demand continues to stay where it’s at. Supply and demand is trying to balance itself and we can’t do it with supply, so it’s trying to get the price high enough to kill demand.”
He says global demand includes phenomenal needs out of India and Brazil, along with North America. Then there were problems revolving around Hurricane Ida and Covid shutdowns.
China has had energy issues too.
“We have seen them take the approach of the government shutting down exports. They are not allowing anything to leave the country, phosphates and nitrogen. That is one of the biggest producers and one of the bigger exporters that has all of a sudden removed themselves, and that’s through June of ’22.”
What should a farmer do now for 2022 needs? Linville says have a conversation with your supplier, as much as you may not want to talk about it.
“Let them know what your intentions are,” he says. “Give them a fighting chance so they can plan the supply. You don’t need to lock it in today, but at least let them know what you’re looking for so they can plan.”
Maybe most importantly, Linville strongly urges farmers to take the emotion of out of these very difficult decisions.