Fertilizer market overview in 2014

Обзор рынка удобрений в 2014 году

About 2.5 million years ago primitive Stone Age (or in Greek παλαιός λίθος) started, and lasted till about 3’000 years before J.C. On its first stage people were able to feed gifts of nature, to provide gathering. But close to the end of the period man started to develop nature and strived for domination over in. He learned irrigation, he used water and wind energy. Later he started to add to the soil different components, influencing harvest. So appeared fertilizers.

Since ancient times organic fertilizer were known like manure, peat, egg-shell, ash, sawdust and so on. As science advances, began to add inorganic substances to soil with feeding component – that is mineral salt. There are nitrogen, phosphate, potash fertilizers and their blends.

Agriculture and food industries influence the fertilizer market most of all. About half of the fertilizers are subsidized globally, feeding requirements and land are reviewed, that is why political factor has a determining influence on the market.

In the world there is a tendency to increase agricultural production. In 2014, according to IFA (or International Fertilizer Industry Assotiation) more than 2’498 mln tons of products were produced; about 2’450 mln tons were utilized. In 1998 the production figure equalied 1’900 mln tons. Increase of production volume results decrease of prices (-1.8%), which, in its turn, changes fertilizers market. Food price index falls -1.5% in 2015. Global demand for mineral fertilizers is estimated at 183 mln in 2014 (+2.2%): 111 mln tons of nitrogen, 41.5 mln tons of phosphate and 30 mln tons of potash fertilizers. Till 2018 the market must grow +1.8%. In 2015 consumption about 185 mln tons is expected.

The Russian government is also held active agricultural policy. Much has been said about the substitution (Russian production instead of imported units). Subsidies for the development of agricultural land reclamationв were increased by 260.1 mln RUR in 2015, total budgetary appropriations for these purposes is now 2’274.8 mln RUR. According to the program of the Ministry of agriculture, in 2014-2020 years (by 2018) is planned to put into operation up to 620.4 thousand hectares of reclaimed land, to protect 1’377.6, thousand hectars of land of retirement.

The biggets mineral fertilizer producers in Russia are Phosagro, Akron, Eurokhim, Uralkhim. Russian producers, at the moment, are working for export mainly. Key areas of consumption – Brazil (19.3%), China (12.3%) and USA (10.5%). Increasing focus is made on the Russian market, where are diverging land.

In 2015 mineral fertilizer production volume, bought by Russian agricultural players, is already up +71 thousal tons. Totally in 2015 about 2’612 thousand tons of fertilizers are planned to be supplied.

The biggest Russian consumers of fertilizers are agroholdings, ie, according to RBC rating: Cherkizovo, Yug Rousi, Mira-Torg, Agro-Belogorie, Agroholding Kuban, Prodimex, Rusagro,Razgoulyai, Agrico and Avangard-Agro.