Farmers forced to pay up to €382/t for urea next year
By Maeve Dineen Tuesday December 04 2007
Fertiliser prices have rocketed over the last number of weeks, with farmers facing price hikes of at least €100/t next year.
Rough indications for spring prices show huge increases across all fertiliser ranges. Prices quoted to Farming Independent yesterday showed Urea is up from €276/t to over €382/t. The price of CAN has increased by over €60 to €270/t. 27: 2.5: 5 was quoted at €337/t an increase of over €100/t on last year, and the cost of 18:6:12 is also up by over €100 to over €387/t.
Fertiliser companies have also warned that the usual price correlation between 18:6: 12 and 10: 10: 20 won't apply this year.
"There will be a price difference of at least €10 between CAN and CAN sulphur. The standard differentials will not apply this year," one industry expert said.
A worldwide shortage of fertiliser, due to increased cereal production, has been blamed for the massive increase in price. Rising oil prices are also adding pressure to prices.
Some fertiliser wholesalers, have yet to come out with a definite price list for next year's fertilisers and instead are adopting a wait and see approach. Worryingly, they say, they are not being guaranteed stock from their suppliers and, therefore, it is too early for them to set prices.
The increased prices will have a serious effect on farmers' costs next year and, in particular, will have a knock-on effect on conacre prices, as farmers try to carry stock over a larger land area.The increase will also significantly hit the cost of buying silage.
Jeremiah Murphy, of Target Fertiliser, said prices are set to increase substantially.
"The price increases are totally outside our control. We are being hit with huge increases from our suppliers.
"A worldwide shortage of fertiliser, coupled with increased demand due to a rise in cereal production, is a having a huge impact," he stated.
Mr Murphy said that, currently, the fertiliser suppliers do not have enough of the product to satisfy their needs.
"The ever-increasing price climbs mean there is no guarantee of supply. While there is no major farmer demand at present, we have to buy to cater for the market.
"We have been very surprised with the substantial price increases over the last number of months," he said.
A spokesperson for Grassland Fertiliser said the company hopes to come out with a price list over the next few weeks. "There is a massive shortage of fertiliser worldwide. It's just not available. Our suppliers can't even give us a guarantee of supply.
"The stock we have bought will not carry us through to the peak time. We buy the fertiliser as close to bagging as possible. Most people had held off buying, hoping the price might ease, but this year the price has just kept shooting up," he added.
