The Brazilian fertilizer industry is expected to grow due to a record harvest, with potential deliveries reaching 46 million tonnes in 2024. A 9.4% increase in grain harvest is projected for the 2024/25 cycle. Favorable exchange ratios and stable raw material prices further support this growth, especially for soybean and corn farmers, who represent 60% of fertilizer demand.
Brazil’s fertilizer industry is poised for robust growth this year due to the anticipated record harvest. Eduardo Monteiro, head of Mosaic’s operations in Brazil and Paraguay, noted that while input sales for the current crop cycle are complete, the historic yield will heighten the need for nutrients in the subsequent planting season. “A record harvest means plants will extract more nutrients from the soil. Farmers will need to replenish those nutrients,” Mr. Monteiro stated.
In 2024, Brazil is forecasted to achieve fertilizer deliveries of 45.6 million tonnes, marking the second-highest rate recorded. Mr. Monteiro projects that this figure could rise to 46 million tonnes, potentially establishing a new record. According to the National Supply Company (CONAB), Brazil’s grain harvest for the 2024/25 cycle is envisioned at 325.7 million tonnes, a 9.4% increase compared to the previous season’s 2022/23 harvest of 322.8 million tonnes.
Further supporting fertilizer sales is the improved exchange ratio between grains and inputs observed since the season commenced. On the Chicago Board of Trade, soybean prices have decreased by 3.1% over the past month yet are still 0.5% higher than six months prior, coinciding with the onset of the 2024/25 crop planting. Corn prices have similarly declined by 2.8% recently, although they have risen more than 13% over the prior six months.
Mr. Monteiro, who also chairs the National Association for Fertilizer Distribution (ANDA), indicated that soybean and corn farmers constitute 60% of Brazil’s fertilizer demand. He remarked, “Corn prices have rebounded strongly. The trend suggests that farmers who grow soybeans in the summer and corn in the second crop will see solid profitability.” Lastly, he noted that prices for essential raw materials in the fertilizer sector have remained stable or even decreased since last year.
In summary, Brazil’s fertilizer industry is set for significant growth, primarily driven by a record harvest expected in the 2024/25 crop cycle. This surge in output will necessitate increased fertilizer applications for nutrient replenishment. Additionally, stable commodity prices and a favorable economic climate for farmers underline the potential for profitability in the sector. The industry appears well-positioned to meet these demands as it heads into a promising planting season.
Original Source: valorinternational.globo.com
