Brazil sets new record for fertilizer demand

Brazil consumed a record 29.5Mt of fertilizers in 2012, according to a report by RC Consultores cited in Valor Econômico, as Brazilian farmers invest in new land and aim to increase yields, particularly for soybean. That total is 4.24% more than the amount of fertilizers used in 2011. Official data from fertilizer association Anda have not yet been released.

RC Consultores expects an increase of 3.38% in fertilizer volume in 2013, to a total of 30.5Mt, due to an increase in arable land and yields. The consultancy says that it is soybeans that are leading the increase in demand, and estimates that spending on fertilizers for soybeans will rise by 24.5% in 2013. A drought in the US in 2012 led to high prices for soybeans and increased planting by Brazilian farmers.

Imports are forecast to rise by 3.5%, from 18.9Mt in 2012 to 19.6Mt. In 2012, spending on fertilizer imports fell by 4.97% to US$8.4bn. Brazil currently imports around 75% of its fertilizers.

The Brazilian government is looking for ways to substitute imports with local production, and state-owned companies such as Petrobras (NYSE: PBR) and local private sector and foreign firms are planning US$18.9bn of investment in new plants by 2017.