Fertiliser markets steady with UK reliant on imports

Fertiliser prices have shown little movement in recent months, with imported ammonium nitrate at about £350/t.

Traders say the market remains fairly quiet, especially across Europe, for both liquid and granular products, but demand has started to pick up slightly.

Global markets are also relatively stagnant, but some drivers remain.

Urea prices in Egypt have reportedly dropped back by about £8/t, while production in India has fallen, and Houthi attacks on cargo ships carrying fertiliser in the Red Sea has added some caution.

See also: Why urea fertiliser use is changing this spring

A weaker exchange rate is also playing a role with sterling lower and trading at £1:US$1.26 midweek, making imports more expensive.

Analysts at ADM Agriculture said UK farmgate prices have edged slightly lower for straight urea, while inhibited urea remains relatively stable. They added: “Potash has reportedly traded higher in Brazil, but prices remain at a discount to European levels at present.”

AHDB analysts said assessing what source of nitrogen is optimal, reviewing nitrogen use efficiency, and maybe seeking alternative sources could help to manage fertiliser cost.

Import reliance

The UK relies on imports for about 60% of its total use, with only about 40% of its requirement produced here.

This means domestic prices are heavily influenced by European gas markets, which had been falling, but have started to recover in recent weeks.

Earlier this month, fertiliser manufacturer Yara announced plans to invest £7m at its liquid fertiliser terminal at Chedburgh in East Anglia, with aims of the upgraded site being fully operational by spring 2025.

Martin Saunders, Yara’s terminal manager, said: “Manufacturing the product ourselves here in the UK allows us to guarantee great product quality from factory to farm.”

Kevin Soper, regional terminal manager for Yara Europe, added that this investment would help it to achieve safe and efficient operations and deliver high-quality products.

New urea application rules

From 1 April, urea fertilisers must include an inhibitor as part of the government’s plan to reduce ammonia pollution by 16% by 2030.

Finley Hawkins, Frontier fertiliser business development manager, said: “The easiest solution  is to use the numerous AN-based options, as the rules don’t apply to these products.

“However, you should still consider product quality, consistency and availability. You should continue to look at the cost per kilogram of nitrogen, as well as the total programme costs for all available options alongside their individual merits for each business.”