FERTILISER COSTS SET TO INCREASE OVER WAR IN UKRAINE

The Ukraine war has led to restrictions on exports of fertiliser which is set to drive up costs for both Cocoa and Coffee farmers.

Given the Russian invasion, Ukraine, a major producer of agricultural products, has banned exports of fertilisers.

The cabinet of ministers is introducing a zero quota for the export of mineral fertilisers, that is a de facto ban on the export of fertilisers from Ukraine… to maintain balance in the domestic market. (that applied to most popular fertilisers, including nitrogen, phosphorus, potassium, and complex fertilisers.)

Ukraine Ministry of Agriculture

Ukraine’s President Volodymyr Zelensky said on Friday the country must sow as many crops as possible this spring, despite the Russian invasion.

Meanwhile, exports of ammonium nitrate have been banned from Russia, the world’s biggest fertiliser exporter, for two months. That could lead to a reduction in fertiliser supplies, especially in South America.

Russia temporarily suspended exports of fertilisers until carriers “resume regular work and provide guarantees that Russian fertiliser exports will be completed in full.”

Andrei Melnichenko, who founded Uralchem, Russia’s largest ammonium nitrate producer based in Switzerland, told CNBC.

One of the victims of this crisis will be agriculture and food… It has already led to soaring prices in fertilizers which are no longer affordable to farmers.

Andrei Melnichenko

According to the UN COMTRADE database on international trade, Russia exported fertilisers to Côte d’Ivoire worth $30.81 million in 2020, and Ukraine exported another US$4.97m according to figures from 2019.

The value of Ghana’s total fertiliser imports in 2019 was $173m, of which 36.29 million was from Russia and approximately 4.87 million from Ukraine in 2020.

Brazil meanwhile imports 85% of its fertiliser, and 20% of that comes from Russia. They are now seeking to secure more supplies from Canada.

According to Fox Business News, who spoke with The Brazilian National Fertilizer Association, the country only has supplies for three months.

Jeferson Souza, a fertiliser analyst at Agrinvest Commodities, a brokerage in Brazil commented

We are now experiencing firsthand what it means to depend on imported fertiliser

Jeferson Souza, fertiliser analyst, Agrinvest Commodities

photo by USAID U.S. Agency for International Development | Flickr

Author

  • Nick Baskett is the editor in Chief at Bartalks. He holds a diploma from the Financial Times as a Non Executive Director and works as a consultant across multiple industries. Nick has owned multiple businesses, including an award-winning restaurant and coffee shop in North Macedonia.

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