Fertilizer demand set to grow, but some uncertainties cast a shadow

23 September 2013 16:21  [Source: ICIS news]

Fertilizer demand set to grow, but some uncertainties cast a shadowDUBAI (ICIS)--The prospects for fertilizer demand growth are positive in the medium-to-long term, but there are some uncertainties casting a shadow over the market, the director general of industry body International Fertilizer Industry Association (IFA) said on Monday.

Speaking at the 4th Annual GPCA Fertilizer Convention, IFA director general Charlotte Hebebrand said that the association expected fertilizer demand to expand by 1.8% per year to 195m tonnes by 2017-2018. Longer term projections from Integer Research also suggest growth of 1.8% to 2030, she added.

Demand for potash is expected to grow the fastest, rising 3% per year to 2017, while nitrogen and phosphates growth rates are forecast at 1.5% and 1.9% per year respectively.

The growth in demand will come from the need to grow crops for a rising and increasingly urban population, she said. Hebebrand noted the UN Food and Agriculture Organization (FAO) predicts that 90% of future agricultural production will have to come from increased yields and cropping intensity rather than from cultivating additional land.

However, while demand prospects are positive, Hebebrand cautioned that there are some uncertainties hanging over the fertilizer market.

Following the deadly blast the West, Texas, plant earlier this year and continued news of fertilizers being used in improvised explosive devices (IEDs) in Afghanistan, there is an increased scrutiny on safety and security. At the same time, there is an increasing awareness of the impact of fertilizers on the environment.

All of these factors could lead to regulations and restrictions on fertilizer usage, Hebebrand said, providing a challenge to the industry and potentially impacting demand.

Hebebrand said IFA was approaching these issues through several initiatives, including a Product Security Taskforce to stop the criminal use of fertilizers, Protect and Sustain to improve safety throughout the whole supply chain and a nutrient stewardship programme to increase nutrient use efficiency.

The GPCA convention is being held in Dubai and runs 22-24 September.

By: Rebecca Clarke
+44 20 8652 3214

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