Fertiliser price hikes will cost sector €70m

CAN and urea prices up by €40-70/tonne

THE IFA has taken issue with fertiliser industry claims that the €40-70/t price hike introduced this season was the result of reduced global product supplies and higher manufacturing charges.

Figures obtained by the IFA show that the volume of fertiliser imported into Ireland last autumn was the highest in three years. The import records show that more than 220,000t of fertiliser was imported in the months from August to October last year, compared to almost 160,000t for the same period in 2016 and 110,000t in 2015.

The IFA claimed the increased level of imports last autumn undermines fertiliser company claims that a tightening of supplies at global level had prompted the price hikes.

“A reluctance on the part of Irish fertiliser importers and blenders to sell to co-ops and merchants was responsible for much of the recent lift in prices, which has seen the cost of CAN and urea increase by €40-70/t,” claimed John Coughlan of the IFA inputs project team. Mr Coughlan said fertiliser importers had created the perception of product shortages to more easily push through the price increases.

However, this assertion was rejected by fertiliser importers who contend that prices at manufacturing level have been increasing since early last summer and continued to harden through the autumn 2017.

They also repeated the assertion that the main international fertiliser manufacturers have more closely matched production to demand over the last 12 months, which reduced overall supplies and pushed up prices.

Mr Coughlan said farmers, particularly tillage growers, could not afford fertiliser price hikes which he estimated will cost around €70m in total.

Fertiliser charges on livestock farms will also be considerably higher, with the price increases adding between €3,500 and €4,000 to overall costs on a 100-cow dairy unit.

Meanwhile, the late spring is reportedly having an impact on prices, with merchants forced to cut quotes as a result of slow sales.

The best quotes over the last week saw bagged CAN trade at €235/t for volume purchases, with general quotes ranging from €245/t to €265/t.

Some farmers were able to buy bagged granular urea as low as €330/t, although €340-360/t seems to be more widely available. The keenest quotes for 18-6-12 and 27-2.5-5 are around €330/t, but these products are generally selling for €340-355/t.