Quarterly Trends Report

Q4 2021: fertiliser producers make hay while the sun shines - but how long will it last?

  • Public Equity
  • Materials
  • North America

Strong demand, spiralling gas prices and supply bottlenecks supercharged fertiliser prices towards the end of 2021 - a boon for producers but an enormous challenge for many farmers. 

At the same time, the prices of major crops such as corn and soybeans reached multi-year highs, attracting many farmers to invest more in their farming inputs.5 Others who are less confident they’ll get a return on that investment have been holding off, planting the same acreage but receiving less yield in the hope that their costs will normalise. If they purchase too late, however, their yields could be impacted. And a sudden rush to buy products closer to spring could create further supply-chain shocks when the industry needs smoothness most. 

Pushback on sky-high prices was apparent in Q4 as restocking for Q1/Q2 2022 crop inputs slowed in Europe. This suggested many farmers “believe that there will be enough product and they can get it later, which is not likely, or they are just buying parts of what they need now and then will try to buy more later or reduce the total amount,” a former executive at Yara International told Forum in October. 

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