rains provide growth to fertiliser market

Stock Journal 31 March 2010

Rains provide growth to fertiliser market

THE record-breaking rains Australia has received since the start of the year have made farmers rejoice, and analysts are expecting the agricultural section to recover from one of the worst years the industry has endured.

Drought and a global financial crisis-induced slump in demand for produce pushed soft-commodity prices south, and subdued farming activity popped the fertiliser bubble, according to The Australian Financial Review.

Prices for key fertiliser, diammonium phosphate (DAP) increased fivefold between 2006 and 2008 to more than $US1000 per tonne, only to fall back as far in 2009. But as the economy recovers and the rain drenches farmers with optimism, input prices are on the way back up.

Since January, the DAP price has risen about 50 per cent to $US490 per tonne while the ammonia price is up about 30 per cent.