New York City, 8 August 2022 (TDI): According to World Bank, fertilizer prices are soaring due to high input costs, trade limitations, and the conflict in Ukraine.
High input costs, trade restrictions, and the war in Ukraine are causing fertilizer prices to skyrocket.
By investing in new technologies, we can help with the current supply challenge and push the frontiers of knowledge to avoid another crisis. https://t.co/TT8JSmPDGU
— World Bank (@WorldBank) August 7, 2022
This poses a serious threat to the availability of food. The war in Ukraine has impacted most nations importing wheat and corn. However, many nations, including several important food exporters, are net fertilizer importers.
Rice, a staple crop that has not yet experienced price increases due to the war, may be affected by persistently high fertilizer costs.
The World Bank’s fertilizer price index increased by about 15% earlier this year; prices have increased more than threefold from just two years ago.
The World Bank adds that the recent increase is caused by high input costs, disruptions in the supply, and trade restrictions. As tensions between Russia and Ukraine grew last fall, there is a reduction in the sustainable production of Ammonia, a crucial component of nitrogen-based fertilizers, which impacted the disruption in supply.
This led to an increase in natural gas prices. Similar to this, China’s primary feedstock for the manufacturing of ammonia, rising coal prices, compelled the production of fertilizer facilities there to decrease.
World Bank on Accessibility and Affordability of Fertilizers
The World Bank proposed several steps to make fertilizer accessible and affordable.
The first step which World Bank proposes is for nations to remove trade limitations or fertilizer export bans. Further, it adds that the situation is made worse by export limitations. It push fertilizers more out of the price range of developing nations with lower incomes. It has worsen rates of hunger and food insecurity.
World Bank also highlights the finance requirements of producers, merchants, and importers are one of the regional obstacles in the world’s commerce in fertilizers.
The second step which World Bank focuses on is that there must be increased efficiency in fertilizer use. This can be achieved by giving farmers the proper incentives and discouraging excessive usage. For instance, the efficiency of nitrogen usage is typically between 30 and 50 percent.
The third step that World Bank highlights is that people need to invest in innovation to create best practices and fresher technologies that will help boost yield per kilogram of fertilizer used.
Further, to guarantee that the best fertilizer and quantity are given to certain crops, this includes investing in expertise. To make fertilizers work as effectively as possible, people must also invest in healthy soil.
