With Eastern Europe cut off from exporting fertilizer, where does the U.S. turn?
A global economist says as a pair of Eastern European Seaports remain closed, and the U.S. will likely need to find other sources to import fertilizer.
Sam Taylor with RaboBank tells Brownfield Nigeria and Iran are two options. “There is also that kind of question that surrounds the Iranian embargo. They are significant urea producers. I think in the last couple of years they have been running significantly below nameplate capacity.”
He says Belarus exports 20 percent of the world’s potash supply with 7 percent coming to North America and those exports in the Baltic Sea have stalled since Russia’s invasion into Ukraine. “It’s not necessarily a prohibited ‘we can not get access to there,’ it’s shear cost and premium of getting your ship into there and whether or not there’s an appetite for traders to risk getting boats in there because there have been boats that have been stuck or sadly sunk.”
Taylor says the Black Sea has also been cut off and traders haven’t shipped nitrogen products for several weeks. “That’s the potash, that’s the phosphate, that’s urea and its’ ammonia. There’s a pipeline which runs from Russia through Ukraine into Usnea that counts for a huge amount of global exports of ammonia and that pipeline is effectively shutoff.”
Brownfield interviewed Taylor at the 2022 Commodity Classic.