World fertiliser production to outstrip demand

World fertiliser production is expected to outstrip demand over the next five years and will support higher levels of food and biofuel production, FAO said in a new report entitled "Current world fertiliser trends and outlook to 2011/12."

"High commodity prices experienced over recent years led to increased production and correspondingly to greater fertiliser use," says Jan Poulisse, FAO fertiliser expert.

"This has led to tight markets and higher fertiliser prices. While it is expected that the demand for basic food crops, fruits and vegetables, for animal products and for biofuel crops is likely to remain strong, we expect fertiliser supply to grow sufficiently to meet higher consumption," he adds.

The FAO report estimates world fertiliser supply (nitrogen, phosphate and potash nutrient) will increase by some 34 million tonnes representing an annual growth rate of 3 percent between 2007/08 and 2011/12, comfortably sufficient to cover demand growth of 1.9 percent annually.

Total production is expected to grow from 206.5 million tonnes in 2007/08 to 241 million tonnes in 2011/12. Fertiliser demand will increase from 197 million tonnes at present to 216 million tonnes in 2011/12.

World nitrogen supply is forecast to rise by 23.1 million tonnes by 2011/12; world phosphate fertiliser supply will increase by 6.3 million tonnes and potash supply by 4.9 million tonnes.

Africa will remain a major phosphate exporter and increase nitrogen exports while importing all of its potash. Fertiliser consumption in Africa continues to be largely restricted to 10 countries, the main consumers being Egypt, South Africa and Morocco.

It is expected that North America will continue to be a net importer of nitrogen and that the region will move into increasing phosphate deficit while remaining a primary supplier of potash.

Asia is expected to produce a rapidly increasing surplus of nitrogen, but will continue to import phosphate and potash.

Business Report