World Bank foresees softer fertilizer prices
The semi-annual World Bank Commodity Outlook Report predicts fertilizer prices will decline by about 10 percent by the end of the third quarter of this year. The declines were more dramatic for urea and phosphate – notably DAP, at more than 10 percent down. The price for other fertilizers changed marginally. That drop comes on the heels of a 3 percent overall decline in prices between 2011 and 2012.
The international organization says reduced demand by India and China are the key factors in the expected drop in prices. The report does note that demand is up in the United States and South America, but that demand is not enough to counter the Indian and Chinese numbers.
The report looked at the 2013-2014 year, and predicted an additional 5 percent drop in overall pricing. The reduced price, according to the report, is expected because of lower natural gas prices, specifically in the Arab Gulf and Russia.
The World Bank used average numbers from fertilizer publications.
For a discussion by a World Bank economist and the link to the full report as a PDF documents, go to http://blogs.worldbank.org/prospects/commodity-market-outlook-july-2013