Outcry triggers fertiliser price drop

Updated: 23/12/2008

Sources: Gregor Heard, Stock & Land – December 22, 2008

              Alison Bell, AAP – December 19, 2008
              Paula Thompson, Stock Journal – December 18, 2008

cropFarmers will see a massive drop in the price of fertiliser after Incitec Pivot slashed its wholesale prices of ammonium phosphate products.

MAP and DAP are now $920/tonne, down a massive $640/t.

The price drop has come too late for many farmers who have already completed fertilising their crops.

Farmers have been fuming at claims by Incitec Pivot that high fertiliser prices are a result of unprecedented volatility in the global market.

Farmers say they shouldn’t have to carry the can for the failed decisions of fertiliser companies.

Incitec Pivot CEO, Julian Segal, says sharply rising global prices created “unprecedented” pre-season demand late in 2007, resulting in temporary shortages as all fertiliser suppliers attempted to meet demand.

However, the prospect of low rainfall and a softening global prices saw Australian fertiliser usage to September drop eight percent below the five-year average.

“This slowdown left the Australian fertiliser industry as a whole with large inventories acquired at high global prices,” Mr Segal said.

“Much of this product – purchased at higher global prices – is still in sheds across the country.”

Mr Segal said world prices had fallen because major importing nations such as India and Brazil were no longer placing orders.

“It is unlikely that we will see these countries, together with North America, return to the markets before February or March 2009, the end of the northern hemisphere winter,” Mr Segal said.


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