FT: Russia’s fertilizer export earnings up 70% in 2022

Despite the decline in sales and export sanctions, in the first ten months of 2022, fertilizer supplies brought the Russian budget $16.7 billion (70% more than in the same period last year, with sales falling by 10%). The newspaper reports Financial Times (FT), whose analysts attribute this situation to the rise in prices for fertilizers against the backdrop of hostilities in Ukraine.

Another factor strengthening Russia’s position in the fertilizer market was the closure of plants in Europe due to a sharp increase in gas prices in the spring of 2022. The FT material notes that the cost of fertilizers (in particular potassium) began to grow even before February 24, 2022: after the imposition of sanctions against Belarus against the background of the suppression of protests and Russia’s reduction in natural gas supplies.

“However, Russia is unlikely to continue to benefit from higher prices this year. The recent drop in European gas prices due to warmer-than-usual weather has pushed down fertilizer prices, with producers in the region ramping up production. The graph presented by the newspaper shows that fertilizer prices peaked at the beginning of the second quarter of 2022, but began to noticeably decline by the beginning of the third quarter.

Participants in the European fertilizer market surveyed by the FT expect further declines in phosphate and potash prices, while global nitrogen stocks are currently considered sufficient.

In the European Union getting better the economic situation against the backdrop of favorable weather conditions that contribute to saving energy resources during the heating season. At the beginning of 2023, gas prices in the EU fell to $780 per 1,000 cubic meters. m is 1/5 of the peak cost of the resource in August 2022.

Read more about the economic situation in the EU – in the publication “Kommersant” “Nothing lasts forever under winter”.

Andrey Sapozhnikov