Source: Radio New Zealand
Fertiliser prices will rise due to the conflict but by how much and for how long is not known. 123rf
Ravensdown says it has enough fertiliser in the country or on the way to cover autumn – so any price impacts due to the war in the Middle East won’t be felt immediately.
The Middle East is a significant player in fertiliser trade with about 40 percent of nitrogen fertilisers coming from the region.
It’s also a major producer of liquid natural gas which is used to manufacture fertilisers.
Ravensdown chief operating officer Mike Whitty said fertiliser prices will rise due to the conflict but by how much and for how long is not known.
“We saw last year in June when there was conflict with Israel, the US and Iran that prices for energy and nitrogen increased reasonably rapidly, by about 15 percent, but then they came down just as fast about two weeks later – so it really depends how long this conflict is going to continue for really.
“We are expecting a significant spike in prices, we are watching the price daily and everyone is waiting to see what happens in the straight because a lot of the worlds fertiliser trade travels through there.”
Whitty said farmers shouldn’t panic.
“The important thing is we have enough fertiliser in the country or on the water coming here to cover all our autumn needs, so it won’t be an issue until later in the year but that’s only if the conflict continues.”
Another complicating factor in fertiliser trade at the moment is China another major producer of nitrogen is not exporting – every now and then it stops sending product offshore in order to protect domestic supply.
Whitty said Ravensdown is well versed in dealing with geo-politics and has solid relationships with suppliers.
He said there are other options to source nitrogen fertiliser if the Middle East war is prolonged – including Malaysia, Brunei, Indonesia and some countries in Africa.
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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand