Brazil’s fertilizer industry is expected to grow significantly due to a record harvest forecasted for 2024/25. Fertilizer deliveries could reach new heights, with improved prices for grains supporting farmer profitability and stable raw material costs enhancing industry prospects.
Brazil’s fertilizer industry is poised for growth, driven by the expectation of a record harvest. Eduardo Monteiro, head of Mosaic’s operations in Brazil and Paraguay, states that, although input sales for the current crop cycle are complete, the upcoming record harvest will increase the demand for essential nutrients in the next planting season. “A record harvest means plants will extract more nutrients from the soil. Farmers will need to replenish those nutrients,” Mr. Monteiro explained.
In 2024, fertilizer deliveries in Brazil hit 45.6 million tonnes, marking the second-highest amount on record. Mr. Monteiro anticipates this figure could rise to approximately 46 million tonnes, setting a new record. According to the National Supply Company (CONAB), Brazil could produce 325.7 million tonnes of grains during the 2024/25 cycle, a 9.4% increase from the previous season. The largest harvest recorded to date was 322.8 million tonnes in 2022/23.
The improving exchange ratio between grains and fertilizers has further bolstered fertilizer sales this season. On the Chicago Board of Trade, soybean prices have experienced a slight decline of 3.1% in the past month but are still 0.5% higher than six months ago. Meanwhile, corn prices dropped 2.8% recently but rose over 13% in the past six months. Soybean and corn farmers, who account for 60% of Brazil’s fertilizer demand, are likely to benefit from this trend. “Corn prices have rebounded strongly. The trend suggests that farmers who grow soybeans in the summer and corn in the second crop will see solid profitability,” stated Mr. Monteiro, also chairman of the National Association for Fertilizer Distribution (ANDA).
Lastly, Mr. Monteiro noted that prices for essential raw materials in the fertilizer industry have remained stable or even decreased since last year, supporting the industry’s outlook.
Brazil’s fertilizer industry is set to grow significantly due to a projected record harvest. As farmers prepare for increased nutrient demand post-harvest and benefit from improving grain prices, fertilizer deliveries could reach unprecedented levels. The stability of raw material prices further supports this favorable environment, benefiting soybean and corn farmers, who dominate the fertilizer market in Brazil.
Original Source: valorinternational.globo.com
