At the beginning of the XNUMXth century, the discovery of the process to create ammonia from hydrogen and nitrogen present in the air allowed the production of nitrogenous fertilizers, which increased the land suitable for cultivation and solved the lack of food that the world suffered. 

This brief piece of history serves as a reminder of the importance of a supply that may seem less important than it really is for the well-being of the world's population. 

Since Russia's invasion of Ukraine, fertilizer prices have risen as sanctions against the first country and its allies, in addition to the partial cessation of Ukrainian exports, have reduced the volume of trade in the raw material needed to manufacture these products.

Fertilizers deliver necessary nutrients to plants so that they can grow efficiently, which is why thousands of agronomists and producers in the world add fertilizers based on nitrogen (N), phosphate (P) and potassium (K), according to the rules of the four Rs (for its translation of ““right”, correct, in English): the correct source of nutrients is applied, at the correct frequency, at the correct time and in the correct place. 

The fertilizer market is largely controlled by the balance of supply and demand, among other factors such as restrictions on exports, seasonality of crops and logistical restrictions. After the beginning of the conflict between the European countries, this last factor took on greater relevance, highlighting a major problem: the world's dependence on the producers with the largest market share of fertilizer raw materials.

The participation of Russia, Belarus and Ukraine in the fertilizer industry

Russia is among the top 5 producers of nitrogen (N), phosphoric acid (P) and potassium (K), while Belarus is part of the same group in potassium production. 

For each of these raw materials, the first five producers represent a total participation of 61%, 79% and 85% respectively. 

Since the beginning of the geopolitical conflict and the sanctions against Russia and its allies, 14% of the world's urea trade, 11% of ammoniacal phosphates and 21% of potassium trade have been stopped. Russia supplies 23% of the ammonia volume and 46% of the ammonium nitrate in the world. 

While the restrictions against Belarus have contracted the potash trade by a further 20%, resulting in a 41% disruption to global supply.

The biggest problem is that although the other major producers - China, Canada, India, the United States - are rushing to increase their volumes, they are not enough to make up for the lack of Russian and Belarusian production. 

Another effect of the sanctions against Russia has been the increase in the price of gas in Europe. Natural gas represents between 70-80% of the production cost of nitrogenous fertilizers, reducing the possibility of its production in the old continent. 

And although there is another alternative through the use of coal to obtain nitrogen, the change, adoption or adaptation of the production process takes years.

food shortage crisis

The incidence of the conflict between Ukraine and Russia are multiple for the possible current food shortage.

The first is the decrease in fertilizers on the market. The regions most dependent on exports from Russia and Belarus are Europe, Latin America and South Asia. The lack of this supply or its increase in price will cause a decrease in the volume cultivated and the closure of operations on farms where production is no longer profitable due to high costs.

Added to this is the fact that Russia is the largest exporter of wheat in the world and Ukraine the largest supplier of marigold oil.

Faced with the scarcity of these products, many governments make the decision to protect the export of their own food production and scarce resources, further reducing their world supply.

To face or avoid this crisis, the IFA spokesperson, following the recommendations of the Food and Agriculture Organization of the United Nations (FAO), advises avoiding these government measures, highlighting that IFA members are working to "overcome the logistical challenges where possible”, regarding the commercialization of nitrogenous fertilizers. 

Finally he concludes: “Fertilizers are precursors of wheat, soybeans, corn and many others. Without fertilizers, staple food production will be limited. Fertilizers were declared essential during the pandemic by many countries, and now is the time to do it for everyone."