Hurricane Ida, natural gas prices, Beltway energy politics and global demand are lining up to bring higher fertilizer prices and possible shortages for the 2022 crop season, according to Chip Flory, host of Farm Journal’s “AgriTalk.”
“At the start of September, more than half of Gulf crude oil and natural gas production was offline thanks to Hurricane Ida,” Flory reported. “By late September, a quarter of Gulf production was still offline, and U.S. natural gas prices were at new highs.” Natural gas is the key component in the manufacture of nitrogen fertilizer.
Nitrogen isn’t the only primary nutrient affected. Analyst Josh Linville of StoneX Group says the Chinese government has banned phosphate exports through June 2022. He feels a combination of factors could work to put fertilizer prices up toward where they were in 2008.
“The problem with this one, though, is back in 2008, it was all demand driven,” Linville told Farm Journal. “We never had a problem finding it, it was just ‘what price are you willing to pay.’ This one is much more supply driven.”Back