Fertilizer prices remain high

On the morning of August 7th, the Minister of Agriculture and Rural Development Le Minh Hoan chaired an online meeting on rice production and consumption in the Mekong Delta.

According to the Plant Protection Department (MARD), from the beginning of 2021 up to now, domestic and world fertilizer prices have continued to experience a monthly increase. "The increase rate in prices of imported fertilizers is higher than that of domestically produced fertilizers", the Plant Protection Department's report emphasized.

The main reason for the sharp increase in fertilizer prices, according to the Plant Protection Department, is the sharp increase in the cost of input materials and transportation. In the past 7 months, the main raw materials for fertilizer production have increased considerably. Specifically, the price of sulfur has increased by 233% (from USD 95/ton to USD 221/ton), the price of sulfuric acid (H2SO4) has increased by 232%, the price of ammonia gas (NH3) has increased by 220%, apatite ore price has increased by 7.7%. Moreover, the increase in world oil prices and the shortage of empty containers have led to an increase in freight rates by 3-5 times.

The Plant Protection Department also excluded the increase in fertilizer prices from the imbalance of supply and demand. Through the survey, large domestic fertilizer manufacturers have been maintaining stable production and supply of fertilizers to the market. Some factories even produced with higher output than the same period in 2020.

In the context that the Covid-19 epidemic is still complicated and unpredictable, transportation costs are high, the global supply chain of stocks and raw materials is easily broken, the Plant Protection Department has prognosticated that fertilizer prices in the country as well as in the world from now to the end of 2021 will remain at a high level.

"Looking at the whole picture, from the increasing demand to production and transportation inputs, the price of fertilizers in the world is forecasted to maintain its hot rise in August, which will even be hard to cool down this year", stated the report of the Plant Protection Department.

However, the increase rate in Vietnam may be less and slower.

In order to stabilize fertilizer prices, the Plant Protection Department proposed relevant ministries, departments and agencies, fertilizer production and trading enterprises to come into agreement in terms of measures such as increasing production output, restricting exports, prioritize sources of goods for domestic production. The Department suggested functional forces to be ready to step in to prevent speculation, hoarding, blowing up to gain profits.

Another solution of the Plant Protection Department is to use fertilizer in an adequate and balanced amount, avoiding waste but ensuring efficiency.

To do so, farmers need to follow the "5 right" principle, increase the application of scientific and technical advances (“3 decrease 3 increase”, “1 right 5 decrease”, IPM ...), use organic fertilizers to replace part of inorganic fertilizers, using biological pesticides to replace chemical ones…