The fertilizer industry that met at the TFI World Conference in San Francisco last week was upbeat about the prospects for the upcoming North American fall and spring seasons. While not everyone may have been happy with higher fertilizer prices, they said higher crop prices will mean good volumes going to the field and plentiful acres planted, particularly corn, soybeans, and wheat. One source said with $4.40 and above corn prices, the industry cannot help but be happy.
Higher fertilizer prices continued to be in vogue, with N, P, and K all seeing either higher trades or postings.
More attendees showed up for sunny San Francisco this year, with an attendee count of 718 on the afternoon of Sept. 13, versus the year-ago 673 when the conference was held in Washington, D.C. Next year’s meeting will return to Chicago, Ill., for the first time since 9/11.
Keynote speaker Ram Charan, a prominent business author and advisor, told attendees that their companies have to design and drive their own destinies ?Çô or someone else will. He said they must be in the bridge of information.
Charan did not have good news for North America, saying that growth is being divided between the North and the South on the 31st parallel. Countries to the North can expect little growth, defensiveness, recession, and psychological malaise. Those in the South will see high growth. He said there will be a transfer of technology from the North to the South. Charan said there will be a fight for jobs, with trade in the South increasing over the next 20 years. He predicted the U.S. will have a trade deficit for the next 10 years.
Charan asked if companies are allocating resources to the whole globe where things are going to happen. He said people see the world from where they sit, and warned that we are building our own competitors.
Another trend Charan noted was companies competing with countries. He gave iron ore for an example, where BHP Billiton, Rio Tinto, and Vale S.A. control 80 percent of production, while China is the largest buyer. He added that cheap money drives monopolies, and that $40 billion is nothing. Charan said the last thing companies with a lot of money want to do is give it to their shareholders, as this is a sign that they cannot find opportunities. He noted companies such as Vale, which is planning to put aside $12 billion to expand into fertilizer.
Perhaps one telling question he asked the audience was who the U.S. Secretary of Commerce is. There was silence. The answer is Gary Locke, former governor of Washington State. Charan said the U.S. has been focused on things other than commerce.
He added that differential protectionism is here to stay.
Pioneer Hi-Bred President Paul Schickler noted the things in common between the seed and fertilizer industries, including the need to raise more food for a growing population. He said the world population will grow to 8.4 billion in 2050, up from today’s 6.4 billion, with most of the increase coming in Asia and Africa. With this will come increased income and more demand for better food, including meat.