Ballance Agri-Nutrients CEO Larry Bilodeau is warning farmers to expect rises in fertiliser prices this year due to the implications of the recovery from the global financial crisis. Bilodeau says during the past year prices have been near or below cost for some manufacturers which is unsustainable. This combined with a shortage of fertiliser as demand rebounds has lead to upward price pressure. Making longer-term pricing forecasts is still problematical, but he says all the indicators show pressure is starting to mount on international prices.

He says balance Agri-Nutrients was able to capitalise on low international prices for phosphate rock to offer its customers a 20% price reduction in it main superphosphate products in December, but it could prove to be short-lived. He notes in the past two months, international DAP and urea prices have risen significantly, with DAP skyrocketing as much as 45%. Sulphur, an ingredient in superphosphate, is also heading for uncertain territory in terms of pricing.

Much of the pressure on prices is coming from companies around the world replenishing their inventories, which they have deliberately allowed to run low over the past 18 months. The Northern Hemisphere crop-planting season will begin soon, and there is a rush to replenish the supply chain in time. Bilodeau says although he can’t predict precise price movements, he is confident prices won’t reach the lofty heights experienced at the end of 2008, and anticipates they will start to settle or possibly come down once inventories are filled and the Northern Hemisphere spring season is over.

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