By KYIV. Jan 29 (Interfax-Ukraine) – There is a shortage of urea-based fertilizers on the domestic market of Ukraine; the supply of them to farmers for spring field work does not exceed 65%, the industry information and analytical agency Infoindustry reported.
Analysts explained that despite the reduction in demand, Ukrainian producers of nitrogen fertilizers increased production of nitrate in December and January 2023. In November, nitrate production amounted to less than 50,000 tonnes, in December it increased to 59,000 tonnes, and in January it could reach 90,000 tonnes, taking into account capacity utilization. At the same time, in these months, manufacturers sold more saltpeter than they produced, since farmers bought for future use.
“The situation with urea is similar, but due to the fact that in the fall most of the nitrate was bought by traders at prices UAH 3,000-4,000 lower than in December, the market does not experience a shortage of supply at fairly favorable prices,” experts noted.
Speaking about urea, which is used more than other types of fertilizers by large agricultural enterprises, they noted a real shortage of goods on the domestic market, despite the fact that its only producer in the country is the plant of the Ostchem holding, which unites enterprises of the nitrogen business of Group DF – Cherkasy Azot.
According to traders, manufacturers are selling goods at the end of March-April.
In January-February, production volumes will be at the level of 30,000 tonnes per month, imports have decreased due to problems at the borders and price swings on the world market. At the time of application, there may simply not be enough urea: manufacturers will not have time to ship, distributors will not have time to clear imports, and warehouses may not physically have enough goods, analysts predict.
According to their information, realizing this, the Ukrainian manufacturer raised prices for urea to UAH 22,500/tonne with delivery.
“Currently, the supply of urea for spring field work does not exceed 65%, this is the lowest figure among nitrogen fertilizers, and it is urea that traders and large buyers of nitrogen fertilizers are most often looking for in January,” Infoindustry stated.
Speaking about ammonium sulfate fertilizer, which is popular in Ukraine, analysts explained that farmers bought quite a lot of it back in November. This granular fertilizer has risen in price due to difficulties with import from UAH 13,000/tonne to UAH 15,000-15,500/tonne with delivery. Even at a price of UAH 17,000/tonne, it is a profitable alternative to other expensive nitrogen fertilizers, experts noted.
“The nitrogen fertilizer market is very dynamic and is influenced by both external and internal factors, but the market will finally be formed by February 1, 2024. They will try to compensate for the deficit of individual nitrogen farmers with other types of nitrogen fertilizers,” the agency concluded.
