There is a growing expectation that nitrogen fertiliser prices are to ease late into the second quarter of this year.
Grassland Agro managing director, Liam Woulfe, spoke at the recent Ulster Arable Society annual conference.
He confirmed that natural gas, ammonia, phosphate and potash prices (despite some reductions in the price of same from their peak levels), remain at levels that are up to four-times higher than they were during the application season of 2021, i.e., prior to Russia’s invasion of Ukraine.
“In my view there is enough fertiliser in the country or contracted to arrive to meet farmers’ needs up to the middle of March or so,” Woulfe told Agriland.
“But this product must be brought through the system in a normal pattern first, in order to allow importers secure the stocks they need for use later in the spring.
“No importer can live with the risk of increasing their current inventories as the working capital that is currently tied up is already unsustainable and cannot be increased further,” he added.
He went on to say a blocked pipeline in the supply chain will cause supply disruptions when peak supplies are required.
So, according to Woulfe, if farmers do not purchase and utilise the stocks of fertiliser that are now available from merchants and co-ops in the normal pattern, importers and merchants will not have the wherewithal to secure the potentially somewhat cheaper supplies of product that will be required for application later in the season.
“We need to see significant quantities of fertiliser moving on to farms over the coming weeks,” Woulfe explained.
Nitrogen prices
While Woulfe believes nitrogen (N) prices may come back later in the year, the same trends are not as evident insofar as phosphorous (P) and potash (K) are concerned, as the price of these two nutrients remains stubbornly more firm.
“P and K prices will be staying where they are for the foreseeable future,” he commented.
In 2022, total fertiliser sales fell by almost 20% in Ireland – relative to 2021. However, nitrogen consumption was only down by about 14%. But the combined P and K reduction in consumption was over 30%.
The Grassland Agro representative is now concerned about the impact of this development on overall soil health.
“Under the new climate change regulations there will be a requirement to reduce the total amount of fertiliser N used in 2023 versus 2021 by 10%. To achieve this the reduction in consumption of N fertiliser in 2022 will need to be maintained,” he said.
“But this issue must be considered in the context of the overall objective, which is to improve the sustainability of Irish farming and agriculture in every respect. The scope to improve fertiliser utilisation rates within Irish agriculture is immense.
“But in order to achieve this, we need to soil test and use the data from same to create a specific and unique fertiliser plan for each farmer to optimise the soil capability and in turn the forage output of their farm with minimum effect on farm output in the short- and long-term.”
Soil health
Woulfe explained that it has long been recognised that soil pH values greatly determine the utilisation efficiency of applied fertilisers.
Recent surveys have confirmed that about 90% of Irish grassland soils are well below their optimal value in one, two or all combinations of pH, P and K.
“Grassland Agro has joined forces with industry partners, including co-ops and merchants, to implement a soil sustainability programme,” Woulfe added.
“This will help their farmer-customers by working directly with each individual farmer on their farm on the detailed diagnosis in order to optimise their soil and forage output in the most sustainable basis through our specific process across the island of Ireland.
“Soil testing diagnosis and action there from, which is guided by farm output optimisation while staying within the ever tightening fertilisation regulatory tolerances, are at the very heart of this work at an individual farm basis,” he added.
Woulfe explained that while there is a significant resource of agronomy staff, they will ultimately have a limited overall capability.
“But if any farmer wishes to get involved, they should talk to their co-op, merchant or any of my Grassland Agro team,” he continued.
“Finally, given the trends in fertiliser sales last year, I am deeply concerned that soil P and K index values have even taken a further hit and thus this further increases the bar to achieve optimum farm output while remaining compliant with regulations.”