Fertilizer prices today August 24, 2022: Fertilizer prices are unlikely to increase sharply when world demand is weak

fertilizer prices today, August 24, 2022: Fertilizer prices are unlikely to increase sharply when global demand is weak According to a recent report by Dragon Capital Securities Corporation (VDSC), Russia and China’s fertilizer export restrictions pushed up prices of this commodity amid concerns about supply disruptions due to the Russia-Ukraine war. With a large position in the world fertilizer map, sanctions on Russia caused prices to increase in the first quarter of this year before cooling down in the second quarter. Experts from this securities company said that the price increase mainly came from urea, DAP, and potassium products. China also maintained a policy of restricting the export of this commodity to ensure domestic demand. In addition, sharp increases in gas prices in Europe also contributed to increasing the cost of gas for fertilizer production in the region, leading to the closure of some factories and a shortage of supply. VDSC assessed that fertilizer demand was weak in the first half of the year. With high prices, demand globally as well as in Vietnam declined. Domestic fertilizer enterprises mainly benefit from the export market due to the decline in supply from major producing countries. It is estimated that domestic fertilizer demand has decreased by 20% – 40% depending on the region. In this situation, domestic production enterprises have increased exports to compensate for low domestic output. Urea production enterprises have enjoyed many advantages in exporting due to the export tightening policy and geopolitical tensions. According to companies from the above securities company, fertilizer prices are supported by political factors and the trend of restricting exports despite weak demand. At present, Russia and China continue to restrict the export of this item until the end of 2022. In addition, Europe has limited the use of gas due to low supply from Russia, causing production activities in the region to be disrupted and also causing a shortage in world supply. VDSC believes that fertilizer prices will find it difficult to increase sharply in the context of weak global fertilizer demand in general.

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