"Farmers typically spend 25% of their operating budget on fertilizer. With corn, soybeans and now wheat tacking on 100% price increases, fertilizer makers have jacked-up prices to suit. In addition, increasingly scant supplies of potassium and phosphate, two of the three key fertilizer components, are pushing record prices even higher."
"Phosphates shot to $300 and then to $400 a ton last year, and are now on track to break $800. Potassium prices also spiked, helped by the shut down of a Russian mine due to flooding.
Out of 50 billion tons of potential phosphate rock reserves worldwide, the USGS estimates the U.S. holds only 3.4 billion tons. Morocco owns 21 billion, China has 13 billion. All are keen to closely manage the resource.
Global consumption of phosphate rock is projected to grow 2.3% a year. But that rate of growth could increase due to demand for biomass used in biofuel production.
Farmers are harvesting larger shares of the plant rubble left after harvest -- a natural source of potassium and phosphate when turned back into the soil. The loss of that natural fertilizer means more P & K demand.
"If we get into more biomass removal," Sawyer said, "that need is going to increase."
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