Robert Besser
29 Nov 2021, 03:35 GMT+10
WASHINGTON D.C.: With agricultural costs being driven to new highs due to a shortfall of nitrogen fertilizer worldwide, farming communities in North America are opting to defer purchases, increasing the possibility of a springtime surge in demand for fertilizers and seed prior to the planting of crops.
Nitrogen fertilizer is used to increase the growth of crops, such as corn, wheat, and canola. Steeper pricing of fertilizers may well lead to breads and meat products becoming costlier for consumers, notes economists.
The United Nations food agency has stated that the cost of food worldwide has reached their highest prices in a decade during the month of October, accompanied by spikes in the pricing of plant-derived oils and wheat.
Meanwhile, the manufacturing of fertilizers in the United States has been hindered by severe winter storms in Texas during February, followed by Hurricane Ida in August. Moreover, the price of natural gas, which is chiefly used in nitrogen production, spiked in the Europe due to soaring demand, as well as a supply shortfall. BMO Capital Markets noted that the November price per ton of urea fertilizer exceeded $1,000 for the first time.
In the United States, stocks of nitrogen fertilizer are expected to be adequate during the upcoming winter, according to Daren Coppock, the chief executive officer at Applied Research Associates. The pre-winter application of these crop nutrients lowers the amount of work to be done by farmers in the springtime.
However, with spiraling prices, farmers are postponing their purchasing, thereby raising the likelihood of very high demand for stocks during the planting season, Coppock stated.
Some $53 billion worth of nitrogen fertilizers were sold globally last year, with prices being 80 percent higher than in 2021, Argus Media noted.
Typically, the Mid-Kansas Cooperative Association would sell fertilizers to farming communities against payments made in advance, to be delivered several months later.
As pricing climbed, however, the Mid-Kansas Cooperative Association curtailed its sales, for which prepayments were completed, as a precautionary measure.
"You just do not know what the price is going to be. It has put a lot of retailers in a tough spot," according to Troy Walker, the association's retail fertilizer director, as quoted by The Guardian.
Get a daily dose of Atlanta Leader news through our daily email, its complimentary and keeps you fully up to date with world and business news as well.
Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to Atlanta Leader.
More InformationAs China unleashed live-fire military exercises off the coast of Taiwan, simulating a real "reunification by force" operation in the ...
NAYPYIDAW, Myanmar - According to a legal official, a court in Myanmar has sentenced former leader Aung San Suu Kyi ...
BEIJING, China: Following a meeting between their foreign ministers, China and Nepal have agreed to build the Trans-Himalayan Multi-Dimensional Connectivity ...
BEIJING, China: Several regions in China experienced temperatures exceeding 40 degrees Celsius, including the major southwestern city of Chongqing.The country's ...
SACRAMENTO, California: California Governor Gavin Newsom is proposing to give a $1.4 billion government loan to extend the life of ...
NEW DELHI, India: A government order released to reporters this week said New Delhi will continue to enforce a mask ...
BANGKOK, Thailand: Thailand seeks to invest $61.97 billion in its industrial eastern region over the next five years, in a ...
JEDDAH, Saudi Arabia: In a Twitter post published this week, Saudi Arabia's Kingdom Holding said it had invested in Russian ...
SYDNEY, NSW, Australia - Stock markets across the Asia Pacific region rallied on Wednesday.In Japan, the Nikkei 225 surged 353.86 ...
DHAKA, Bangladesh A preliminary investigation into the tragic crane accident that killed five people in Uttara on Monday has found ...
HANOI, Vietnam: The Vietnamese government is considering building a high-speed railway, with a possible cost of up to $58.7 billion, ...
NEW YORK, New York - Stocks were decidedly mixed in the U.S. on Tuesday as investors struggled to make a ...