Alexey Belogoryev, Research and Development Director of the Institute for Energy and Finance, commented to the Vedomosti newspaper on the global crisis in the fertilizer market and its consequences for the global food market.
According to Alexey Belogoryev, Iran, Qatar, Saudi Arabia and the United Arab Emirates account for 35% of the commodity exports of carbamide and 32% of ammonia.
He points out that the crisis in the region occurred on the eve of the sowing season in the Northern Hemisphere and the sowing of winter crops in the Southern Hemisphere.
A shortage of nitrogen fertilizers is forming on the market, a phosphate crisis will be added by May-June, and if supplies do not resume by April, the most difficult situation will be in India, Southeast Asia and East Africa, the expert states: "We are talking about a physical shortage of carbamide and ammonia fertilizers, which will undermine the yields of rice, corn and sugar cane.""April-May is the peak of demand for nitrogen fertilizers. If the war does not end by mid–April, the market will see a dramatic increase in spot prices above the peaks of spring 2022," Belogoryev emphasizes.
Belogoryev notes that the fertilizer crisis threatens a shortage of feed for the meat industry, and the price rally will also affect wheat and sugar. The blockade of Hormuz directly affects the cost of food by the prices of petroleum products, freight, and transportation insurance: "By next winter, the global economy may face an increase in food inflation."
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