Fertiliser prices: Global demand and shipping delays cause price hike

Farmers are being urged to lock in fertiliser requirements early as prices jump $100-$200/tonne in the past two months.

Fertiliser prices have risen significantly. Picture: Alison Wynd

Farmers are becoming increasingly concerned about fertiliser and chemical pricing as well as availability as global demand and interruptions to manufacturing and shipping disrupt the supply chain.

Many categories of fertiliser have risen a further $100-$200 a tonne in the past two months — in some cases double the rates of 12 months ago.

Glyphosate and other chemical costs are also rising, and growers are being urged to forward plan and lock in orders as supplies tighten due to global Covid-19 workforce limitations, manufacturing pressure in China, rising sea freight costs and tight shipping space.

But a major farm supplier has urged growers not to panic about supply, but to plan ahead.

The Weekly Times reported in July that fertiliser rates had leapt to their highest levels in a decade, with urea lifting from $400/tonne in February to more than $800/tonne; and phosphorus fertiliser has climbed from a base of $600/tonne in November to $900/tonne.

Grain Growers chairman and Quambatook grower Brett Hosking said most categories were “north of $1000/tonne”, although some urea may be available for less.

“There is concern among farmers that fertiliser prices — which is one of the least transparent markets — have continued to grow and we also know bulk shipping costs have continued to climb, also increasing pressure on prices,” Mr Hosking said.

“There are also supply concerns and the advice is, it’d be wise to get in contact with your supplies of fertiliser and chemical inputs now for next year.”

Australia’s reliance on international companies and manufacturers made the industry susceptible to supply chain issues.

Grain Growers was in “constant contact” with suppliers and resellers and would “pass on all we know to growers”, he said.

While the scope of the issue was hard to predict, Mr Hosking said it would be wise to lock in a portion of requirements early.

Full soil moisture profiles in NSW cotton and sorghum growing areas meant there would be huge demand from that sector in the next month or two.

Major Western Victorian agricultural supplier Gorst Rural director Cam Conboy said there was a lot of speculation on where fertiliser prices would sit when suppliers firmed up how much product would be delivered to Australian ports, when and where it came from.

Mr Gorst said he had fielded calls from many growers over the past 10 days “all very concerned”.

“I just assure people that I don’t think they should panic, I think supplies will be OK, but it will be difficult to chase any upside (extra supply volume),” he said.

NSW Farmers grains committee chair Justin Everitt from Howlong said rising input prices were concerning, but they were getting mixed messages about supply.

“We weren’t expecting the urea price to jump as much this year. All input costs seem to be on the rise,” he said.