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Fertilizers: latest impacts of Covid-19 on global marketqrcode

Apr. 20, 2020

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Apr. 20, 2020
Global fertilizer markets continue to be challenged by the logistical and associated economic impacts of Covid-19. But the impacts are highly uneven across markets and not all are negative.
The main effect remains the constraints on logistics, but again, the effect has been both bullish and bearish. In Italy for example, demand for urea has been strong to ensure supply in advance of possible Covid-19 logistical delays. Conversely, in the Philippines, port logistics have been hit by lockdowns, hampering urea import demand. Meanwhile in Myanmar, urea contract shipments are moving normally despite lockdown which will last until 20 April.
On the demand side, in Malawi, Alliance One has delayed the award of its 30 March NPK tender for various fertilizers for application to tobacco plantations, due in part to concerns over the coronavirus.
The lockdown in India has stymied domestic phosphate production. This has led Moroccan phosphate producer OCP to halt phosphoric acid raw material shipments to India as a result of the uncertainty over coronavirus.
In the US, the pandemic has severely damaged farmer sentiment as corn prices continue a month-long slump. Moreover logistical precautions have caused delays of up to 10 days at the key barge point of New Orleans (Nola).
The impact on fertilizer supply has, in the main, been relatively limited. But there are some notable exceptions.
In India, the lockdown on fertilizer movements and operations (a full resumption of market activity is not expected until 20 April) has led to substantial losses in domestic urea production. Paradoxically this could support the urea market as a fresh import tender is expected imminently.
In Nigeria, most NPK blenders have closed down operations despite exceptions (the government has extended lockdown to 27 April but fertilizers are classified as an essential commodity).
Also in Africa, Tunisian phosphate producer GCT has delayed the start up of its second DAP line at Gabes following maintenance as well as the commissioning of its new 400,000t/yr TSP plant at Gafsa again due to Covid-19.
By Mike Nash
Source: Argus Media

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