Fertilizers

Global fertilizer affordability drops to 2½-year low

Global fertilizer affordability drops to 2½-year low

London, 24 March (Argus) — Global fertilizer affordability has dropped to its lowest in two and a half years, driven by firm phosphate and potash prices, while crop values have dipped to the lowest since 2020. Nutrient affordability fell to 0.82 points in March, the lowest since November 2022, Argus data show. An affordability index — comprising a fertilizer and crop index — above one indicates that fertilizers are more affordable compared with the base year set in 2004. An index below one indicates lower nutrient affordability. The index has dropped owing to higher fertilizer prices for phosphates and potash, which were partly offset by a decline in urea prices. Crop prices have fallen for all major grains and oilseeds on trade tensions. Phosphate prices were supported by competing demand for limited supply. The absence of Chinese product from the global phosphates market since late 2024 has kept supply tight. Additionally, a lack of clarity surrounding China's return to the export market, while firm sulphur and sulphuric acid costs force domestic DAP/MAP prices higher, has prevented any softer sentiment in the region. Competition between India and Ethiopia has driven DAP demand east of Suez. A significant decline in stocks in India by the end of its high season forced buyers to remain in the market during the off season. This coincided with Ethiopia switching to import DAP from NPS from the third quarter of 2024, seeking over 1mn t of the product across regular tenders. Re-emerging interest from Latin America, and with China still out of the market, has allowed suppliers to raise MAP prices, while US DAP/MAP barge prices are firming again ahead of spring applications. On potash, MOP prices have been on the up this year, also driven by tight supply. Belarus' Belaruskali began major works at its fourth mine in January, which will reduce exports of white MOP by around 1mn t in the first half of 2025. In February, Uralkali announced that it will undertake maintenance in the second quarter that will cut its MOP output by around 300,000 t/yr, further cementing the stronger market sentiment. It also said it will push more product — at least 400,000t of MOP — to the domestic market in 2025. Canpotex also confirmed that it is fully committed for the first half of this year, while uncertainty over tariffs on US imports of Canadian imports also drove up sentiment. MOP prices have been particularly low compared with other key nutrients, specifically phosphate and nitrogen products. And expectations that MOP prices are likely to rise further have encouraged buyers to step into the market earlier and for larger amounts than normal as affordability remains healthy. Urea prices have fallen steadily in March, after hitting 16-month highs in mid-February. The combination of a delayed tender issuance from India, with expectations initially appearing in early February, and the restart of Iranian urea production this month — after outages since December — have weighed on sentiment following a price rise since early December. The lack of a tender in India has enabled US importers to build the line-up for the spring season, releasing pressure on buyers for March-loading cargoes. And a lack of spot import interest in urea from Australia, which appeared earlier than usual in the first quarter of last year, has yet to tighten the balance significantly east of Suez. On the other hand, crop prices for corn, wheat, rice and soybeans have fallen sharply in March, with the crop index — which includes global prices adjusted by output volumes — dropping to the lowest since August 2020 partly on uncertainty over trade dynamics following the imposition of trade tariffs. There is a risk that declining grain prices will weigh on demand for crop inputs. By Lili Minton, Tom Hampson, Julia Campbell and Harry Minihan Global fertilizer affordability Index Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.