Global fertiliser prices have soared and will end up affecting your pocket
It's expensive for farmers to produce the food we eat.
Not least in terms of their costs is fertiliser, and international prices are at their highest levels in more than 24 months (except for potassium chloride).
The driving factors cited by analysts include low stock levels due to Covid-19, rising natural gas prices and higher crop plantings in the northern hemisphere (with particular demand for nitrogen).
Agricultural economist Ikageng Maluleke published a comparative table on the Grain SA website:
The soaring global fertiliser prices are becoming a worry for South Africa says Dawie Maree, agricultural economist at FNB.
We are going into the planting season for our winter grains (wheat, barley etc.)... but farmers are already buying their inputs for the summer grains for the next season, starting in August/September, for maize and soya beans.Dawie Maree, Agricultural economist - FNB
Maree points out that fertiliser, herbicide and diesel are the three main input costs for grain producers in South Africa.
The problem is that the input cost increases must be absorbed by the farmers on the other end of the supply chain, so farmers are price takers on the one end and the consumer is the price taker on the other end.Dawie Maree, Agricultural economist - FNB
The farmers can't just pass the increase in fertiliser price to the next guy in the chain. In the end it will slowly but surely filter through into the food inflation.Dawie Maree, Agricultural economist - FNB
For more detail, listen to the interview below:
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