Ireland’s fertiliser supply chain is under severe pressure and could struggle to secure sufficient stocks for the country’s needs next spring.

A leading fertiliser importer admitted that his company had procured just 70% of its usual tonnage for this time of the year.

Dangerously low

He maintained that dangerously low fertiliser stocks on international markets, along with record prices and shipping difficulties had combined to “rattle the industry’s confidence”.

The importer claimed he has secured shipping for just 25% of the contracted volume of fertiliser he has purchased to-date. “We have record prices, it’s extremely difficult to buy product, and then you struggle to get shipping. I’ve never experienced a market like this,” he said.

While some merchants are talking of farmgate prices for urea and CAN of €850/t and €600/t respectively, most are holding off quoting prices for new-season stock because they don’t know what quantities or what products they can source.

“It is embarrassing to admit, but we can’t quote prices to farmers because we haven’t firm prices on product ourselves, or a commitment of supply,” one merchant told the Irish Farmers Journal. “We’re heading into uncharted waters here.”

Given the surge in prices and the difficulty in securing stocks, both importers and merchants are forecasting a sizeable drop in fertiliser sales for 2022.

Overall usage

One industry source estimated that overall usage in 2022 could be back by 20-25%.

A tightening of credit on fertiliser purchases will drive the fall-off in usage, he predicted.

“Credit along the supply chain is going to be gobbled up by the hike in prices, so a big percentage of the purchase cost will have to be paid up front. This will obviously impact cashflow; that will be a big pressure point for everybody involved in the trade,” he added.

Minister’s concern

Meanwhile, Agriculture Minister Charlie McConalogue voiced his concern about the potential impact of rising input costs on farming.

I am concerned about the negative developments in the fertiliser market and the rising costs of other inputs. Producers are facing significant input price increases in fuel, fertilisers, feed and energy, which will put margins under significant pressure if they are sustained over time.

“We need to examine all relevant factors, including the issue of anti-dumping duties on fertilisers,” he said, speaking at the Agrifish Council in Brussels this week, where the main discussions centred on the current state of agriculture markets.