Rising gas prices lead to a significant drop in fertiliser sales as prices skyrocket
In Q2 2022, the German fertilizer market experienced a significant downturn, with sales figures showing a decrease across all categories. The imports and exports of fertilizers based on phosphates, nitrogen, or potassium decreased by 11% and 52.6% respectively, compared to the previous year.
The imports of phosphate fertilizers amounted to 15,100 tons, a decrease of 52.6%, while the exports totalled 11,400 tons, a decrease of 74.5%. The sales of phosphate fertilizers in Germany decreased by 50.6%, amounting to 14,000 tons.
The sales of potash fertilizer decreased by 52.3%, amounting to 55,900 tons, and the sales of nitrogen fertilizer decreased by 18.5%, amounting to 238,000 tons of nitrogen. However, the sales of lime fertilizer remained almost unchanged, decreasing by 0.1%, amounting to 592,600 tons.
The graph presented by the Federal Statistical Office does not show the drop in fertilizer sales as dramatically as the numbers suggest, as it goes back to the year 2019. This may give the impression of a more stable market than the actual figures suggest.
The decreasing imports and exports of fertilizers are a result of the high prices and reduced production. The high gas prices and the resulting reduction in fertilizer production and distribution have contributed to the price increases for fertilizers since this spring. The producer prices for fertilizers and nitrogen compounds in August 2022 were more than doubled (+108.8%) compared to the previous year.
The most important import partners for Germany for phosphate, nitrogen, and potassium fertilizers are traditionally countries like Russia, Belarus, and Morocco, while key export partners include EU neighbors such as the Netherlands and Poland. However, due to recent geopolitical tensions and supply chain disruptions, Germany has notably shifted its import sources away from Russia and Belarus in the past months, increasingly sourcing fertilizers from alternative countries like Morocco for phosphate and other global suppliers for nitrogen and potassium fertilizers.
The decreased sales of fertilizers may lead to lower harvest yields in agricultural areas, as they are supplied with significantly less fertilizer. However, the largest category of lime fertilizer sales remained constant, which may be a glimmer of hope for the upcoming harvests.
The prices of fertilizers in Germany have strongly increased in Q2 2022 compared to the previous year. Already in March 2022, the first month after the beginning of the war in Ukraine, the producer prices for fertilizers were 87.2% higher than in March 2021. The production of most fertilizers is very energy-intensive, requiring natural gas as both a raw material and an energy source in the production process.
The sales figures provided are for the second quarter of 2022.
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